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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
__________
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): August 27, 1998
HEALTH CARE PROPERTY INVESTORS, INC.
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(Exact name of registrant as specified in its charter)
Maryland 1-8895 33-0091377
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(State or Other (Commission File Number) (I.R.S. Employer
Jurisdiction of Identification No.)
Incorporation)
4675 MacArthur Court, 9th Floor, Newport Beach, California 92660
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(Address of Principal Executive Offices) (Zip Code)
(949) 221-0600
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(Registrant's telephone number, including area code)
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Item 5. Other Events.
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MEDIUM TERM NOTES OFFERING
On June 18, 1998, Health Care Property Investors, Inc. (the "Company")
filed with the Securities and Exchange Commission (the "Commission") a
registration statement on Form S-3 (File No. 333-57163) (the "Registration
Statement"), relating to the registration under the Securities Act of 1933, as
amended, of up to $600,000,000 aggregate offering price of common stock, par
value $1.00 per share, preferred stock, par value $1.00 per share, and/or
unsecured debt securities of the Company, which Registration Statement was
declared effective on June 30, 1998.
On August 27, 1998, the Company entered into a distribution agreement (the
"Distribution Agreement") with Merrill Lynch & Co., Merrill Lynch, Pierce,
Fenner & Smith Incorporated, Goldman, Sachs & Co., NationsBanc Montgomery
Securities LLC and BNY Capital Markets, Inc., as underwriters, pursuant to which
the Company agreed to issue and sell up to an aggregate initial offering price
of $150,000,000 Medium-Term Notes, Series D, due nine months or more from date
of issue (the "Notes"). The Distribution Agreement is attached hereto as an
Exhibit.
PREFERRED STOCK OFFERING
Pursuant to the Registration Statement, on September 1, 1998, the Company
entered into a purchase agreement (the "Purchase Agreement") with Merrill Lynch
& Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated, Morgan Stanley & Co.
Incorporated, PaineWebber Incorporated, Prudential Securities Incorporated and
Salomon Smith Barney Inc., as underwriters, pursuant to which the Company agreed
to issue and sell up to 5,750,000 shares of the Company's 8.70% series B
cumulative redeemable preferred stock (the "Series B Preferred Shares"). Each
of the Purchase Agreement, an opinion with respect to the legality of the Series
B Preferred Shares and an opinion with respect to tax matters of the Series B
Preferred Shares is attached hereto as an Exhibit.
PRESS RELEASE
On September 9, 1998, the Company issued a press release announcing the
issuance of the Series B Preferred Shares.
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Item 7. Financial Statements and Exhibits.
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(c) Exhibits.
1.1 Distribution Agreement, dated August 27, 1998, between the
Company and Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner &
Smith Incorporated, Goldman, Sachs & Co., NationsBanc Montgomery
Securities LLC and BNY Capital Markets, Inc.
1.2 Purchase Agreement, dated September 1, 1998 between the Company
and Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith
Incorporated, Morgan Stanley & Co. Incorporated, PaineWebber
Incorporated, Prudential Securities Incorporated and Salomon
Smith Barney Inc.
1.3 Press Release, dated September 9, 1998, of the Company.
4.1 Officers' Certificate pursuant to Section 301 of the Indenture
dated as of September 1, 1993 between the Company and The Bank of
New York, as Trustee, establishing a series of securities
entitled "Medium-Term Notes, Series D."
4.2 Note described in Exhibit 4.1.
5.1 Opinion of Ballard, Spahr, Andrews & Ingersoll, LLP regarding
legality of the Medium-Term Notes, Series D.
5.2 Opinion of Latham & Watkins regarding legality of the Medium-Term
Notes, Series D.
5.3 Opinion of Ballard, Spahr, Andrews & Ingersoll, LLP regarding
legality of the Series B Preferred Shares.
8.1 Opinion regarding tax matters of the Medium-Term Notes, Series D.
8.2 Opinion regarding tax matters of the Series B Preferred Shares.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, the registrant has duly caused this report to be signed on its behalf
by the undersigned thereto duly authorized.
Dated: September 29, 1998
HEALTH CARE PROPERTY INVESTORS, INC.
By: /s/ Edward J. Henning
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Name: Edward J. Henning
Title: Senior Vice President,
General Counsel and
Corporate Secretary
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EXHIBIT INDEX
1.1 Distribution Agreement, dated August 27, 1998, between the Company and
Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated,
Goldman, Sachs & Co., NationsBanc Montgomery Securities LLC and BNY Capital
Markets, Inc.
1.2 Purchase Agreement, dated September 1, 1998 between the Company and Merrill
Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated, Morgan
Stanley & Co. Incorporated, PaineWebber Incorporated, Prudential Securities
Incorporated and Salomon Smith Barney Inc.
1.3 Press Release, dated September 9, 1998, of the Company.
4.1 Officers' Certificate pursuant to Section 301 of the Indenture dated as of
September 1, 1993 between the Company and The Bank of New York, as Trustee,
establishing a series of securities entitled "Medium-Term Notes, Series D."
4.2 Note described in Exhibit 4.1.
5.1 Opinion of Ballard, Spahr, Andrews & Ingersoll, LLP regarding legality of
the Medium-Term Notes, Series D.
5.2 Opinion of Latham & Watkins regarding legality of the Medium-Term Notes,
Series D.
5.3 Opinion of Ballard, Spahr, Andrews & Ingersoll, LLP regarding legality of
the Series B Preferred Shares.
8.1 Opinion regarding tax matters of the Medium-Term Notes, Series D.
8.2 Opinion regarding tax matters of the Series B Preferred Shares.
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EXHIBIT 1.1
HEALTH CARE PROPERTY INVESTORS, INC.
(a Maryland Corporation)
Medium-Term Notes, Series D
Due Nine Months or More from Date of Issue
DISTRIBUTION AGREEMENT
August 27, 1998
MERRILL LYNCH & CO.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
World Financial Center
North Tower, 10th Floor
New York, New York 10281-1310
GOLDMAN, SACHS & CO.
85 Broad Street
New York, New York 10004
NATIONSBANC MONTGOMERY SECURITIES LLC
100 N. Tryon Street
7th Floor
Charlotte, North Carolina 28255
BNY CAPITAL MARKETS, INC.
One Wall Street, 18th Floor
New York, New York 10286
Dear Sirs:
Health Care Property Investors, Inc., a Maryland corporation (the
"Company"), confirms its agreement with Merrill Lynch, Pierce, Fenner & Smith
Incorporated, Goldman, Sachs & Co., NationsBanc Montgomery Securities LLC and
BNY Capital Markets, Inc. (each an "Agent" and, collectively, the "Agents") with
respect to the issue and sale by the Company of its Medium-Term Notes described
herein (the "Notes"). The Notes are to be issued pursuant to an indenture (the
"Indenture", which term as used herein includes any instrument establishing the
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form and terms of the Notes) dated as of September 1, 1993 between the Company
and The Bank of New York, as trustee (the "Trustee").
As of the date hereof, the Company has authorized the issuance and sale of
up to $150,000,000 aggregate initial offering price of Notes to or through the
Agents pursuant to the terms of this Agreement. It is understood, however, that
the Company may from time to time authorize the issuance of additional Notes and
that such additional Notes may be sold to or distributed through the Agents
pursuant to the terms of this Agreement, all as though the issuance of such
Notes were authorized as of the date hereof.
This Agreement provides both for the sale of Notes by the Company to one or
more of the Agents as principal for resale to investors and other purchasers and
for the sale of Notes by the Company directly to investors (as may from time to
time be agreed to by the Company and the applicable Agent) in which case the
applicable Agent will act as agent of the Company in soliciting Note purchases.
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3 (No. 333-57163) for the
registration of $600,000,000 aggregate offering price of common stock, par value
$1.00 per share, preferred stock, par value $1.00 per share, and debt
securities, including the Notes, under the Securities Act of 1933, as amended
(the "1933 Act") and the offering thereof from time to time in accordance with
Rule 415 of the rules and regulations of the Commission under the 1933 Act (the
"1933 Act Regulations"). Such registration statement has been declared
effective by the Commission and the Indenture has been qualified under the Trust
Indenture Act of 1939, as amended (the "1939 Act"). Such registration statement
(and any further registration statements which may be filed by the Company for
the purpose of registering additional Notes and in connection with which this
Agreement is included or incorporated by reference as an exhibit) and the
prospectus constituting a part thereof, and any prospectus supplements relating
to the Notes, including all documents incorporated therein by reference, as from
time to time amended or supplemented by the filing of documents pursuant to the
Securities Exchange Act of 1934, as amended (the "1934 Act"), the 1933 Act or
otherwise, are referred to herein as the "Registration Statement" and the
"Prospectus", respectively, except that if any revised prospectus and/or
prospectus supplement relating to the Notes shall be provided to the Agents by
the Company for use in connection with the offering of the Notes, whether or not
such revised prospectus and/or prospectus supplement relating to the Notes is
required to be filed by the Company pursuant to Rule 424(b) of the 1933 Act
Regulations, the term "Prospectus" shall refer to such revised prospectus and/or
prospectus supplement relating to the Notes from and after the time it is first
provided to the Agents for such use. Notwithstanding the foregoing, for
purposes of this Agreement any prospectus supplement prepared with respect to
the offering of a series of debt securities other than the Notes shall not be
deemed to have supplemented the Prospectus.
Section 1. Appointment as Agent.
(a) Appointment. Subject to the terms and conditions stated herein
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and subject to the reservation by the Company of the right to appoint, upon
two business days' prior
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written notice to the Agents, additional persons as "Agents" hereunder
(provided that each such additional person agrees to be bound by all of the
terms of this Agreement (including Schedule A)), the Company hereby agrees
that Notes will be sold exclusively to or through the Agents. Each Agent is
authorized to engage the services of any other broker or dealer in
connection with the offer or sale of the Notes purchased by such Agent as
principal for resale to others but is not authorized to appoint sub-agents.
In connection with sales by the Agents of Notes purchased by the Agents as
principal to other brokers or dealers, the Agents may allot any portion of
the discount they have received in connection with such purchase from the
Company to such brokers or dealers. The Company agrees that during the
period the Agents are acting as the Company's agents hereunder, the Company
will not contact or solicit potential investors to purchase the Notes.
Notwithstanding anything to the contrary contained herein, the Company may
accept offers to purchase Notes through an agent other than the Agents if
(i) the Company shall not have solicited such offers, (ii) the Company and
such agent shall have entered into an agreement with the same terms as this
Agreement (including Schedule A) and (iii) the Company shall have notified
the Agents promptly after the acceptance of any such offer and shall have
provided the Agents with a copy of such agreement in written form promptly
following the execution thereof.
(b) Sale of Notes. The Company shall not sell or approve the
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solicitation of purchases of Notes in excess of the amount which shall be
authorized by the Company from time to time or in excess of the principal
amount of Notes registered pursuant to the Registration Statement. The
Agents will have no responsibility for maintaining records with respect to
the aggregate principal amount of Notes sold, or of otherwise monitoring
the availability of Notes for sale, under the Registration Statement.
(c) Purchases as Principal. No Agent shall have any obligation to
----------------------
purchase Notes from the Company as principal, but each Agent may agree from
time to time to purchase Notes as principal. Any such purchase of Notes by
an Agent as principal shall be made in accordance with Section 3(a) hereof.
(d) Solicitations as Agent. If agreed upon by an Agent and the
----------------------
Company, such Agent acting solely as agent for the Company and not as
principal will solicit purchases of the Notes. Such Agent will communicate
to the Company, orally or in writing, each reasonable offer to purchase
Notes solicited by such Agent on an agency basis, other than those offers
rejected by such Agent. Such Agent shall have the right, in its discretion
reasonably exercised, to reject any proposed purchase of Notes, as a whole
or in part, and any such rejection shall not be deemed a breach of such
Agent's agreement contained herein. The Company may accept or reject any
proposed purchase of the Notes, in whole or in part, and any such rejection
shall not be deemed a breach of the Company's agreement contained herein.
Such Agent shall make reasonable efforts to assist the Company in obtaining
performance by each purchaser whose offer to purchase Notes has been
solicited by such Agent and accepted by the Company. Such Agent shall not
have any liability to the Company in the event any such agency purchase is
not consummated for any reason. If the Company shall default on its
obligation to deliver Notes to a
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purchaser whose offer it has accepted, the Company shall (i) hold such
Agent harmless against any loss, claim or damage arising from or as a
result of such default by the Company and (ii) notwithstanding such
default, pay to such Agent any commission to which it would be entitled in
connection with such sale.
(e) Reliance. The Company and the Agents agree that any Notes
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purchased by an Agent shall be purchased, and any Notes the placement of
which an Agent arranges shall be placed by such Agent, in reliance on the
representations, warranties, covenants and agreements of the Company
contained herein and on the terms and conditions and in the manner provided
herein.
Section 2. Representations and Warranties.
(a) The Company represents and warrants to each Agent as of the date
hereof, as of the date of each acceptance by the Company of an offer for
the purchase of Notes (whether from such Agent as principal or through such
Agent as agent), as of the date of each delivery of Notes (whether to such
Agent as principal or through such Agent as agent) (the date of each such
delivery to such Agent as principal being hereafter referred to as a
"Settlement Date"), and as of any time that the Registration Statement or
the Prospectus shall be amended or supplemented or there is filed with the
Commission any document incorporated by reference into the Prospectus (each
of the times referenced above being referred to herein as a "Representation
Date") as follows:
(i) Due Incorporation and Qualification. The Company (A) has been
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duly incorporated and is validly existing as a corporation in good standing
under the laws of the State of Maryland with corporate power and authority
to own, lease and operate its properties and to conduct its business as
described in the Prospectus; (B) has the requisite corporate power and
authority to execute and deliver this Agreement, the Indenture and the
Notes and to perform its obligations hereunder and thereunder; (C) has duly
authorized, executed and delivered this Agreement and this Agreement
constitutes the valid and binding agreement of the Company; (D) is duly
qualified as a foreign corporation to transact business and is in good
standing in each jurisdiction in which such qualification is required,
whether by reason of the ownership or leasing of property or the conduct of
business, except where the failure to so qualify and be in good standing
would not have a material adverse effect on the condition, financial or
otherwise, or the earnings, business affairs or business prospects of the
Company and its subsidiaries considered as one enterprise; (E) is in
substantial compliance with all laws, ordinances and regulations of each
state in which it owns properties that are material to the properties and
business of the Company and its subsidiaries considered as one enterprise
in such state; and (F) has at all times operated in such manner as to
qualify as a "real estate investment trust" under the Internal Revenue Code
of 1986 (the "Code") and intends to continue to operate in such manner.
(ii) Subsidiaries. Each subsidiary of the Company which is a
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significant subsidiary (each, a "Significant Subsidiary") as defined in
Rule 405 of Regulation C of
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the 1933 Act Regulations has been duly organized and is validly existing as
a corporation or partnership, as the case may be, in good standing under
the laws of the jurisdiction of its organization, has power and authority
as a corporation or partnership, as the case may be, to own, lease and
operate its properties and to conduct its business as described in the
Prospectus and is duly qualified as a foreign corporation or partnership as
the case may be, to transact business and is in good standing in each
jurisdiction in which such qualification is required, whether by reason of
the ownership or leasing of property or the conduct of business, except
where the failure to so qualify and be in good standing would not have a
material adverse effect on the condition, financial or otherwise, or the
earnings, business affairs or business prospects of the Company and its
subsidiaries considered as one enterprise; all of the issued and
outstanding capital stock of each such corporate subsidiary has been duly
authorized and validly issued, is fully paid and non-assessable and, except
for directors' qualifying shares, is owned by the Company, directly or
through subsidiaries, free and clear of any security interest, mortgage,
pledge, lien, encumbrance, claim or equity; and all of the issued and
outstanding partnership interests of each such subsidiary which is a
partnership have been duly authorized (if applicable) and validly issued
and are fully paid and non-assessable and (except for other partnership
interests described in the Prospectus) are owned by the Company, directly
or through corporate subsidiaries, free and clear of any security interest,
mortgage, pledge, lien, encumbrance, claim or equity.
(iii) Registration Statement and Prospectus. The Company meets the
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requirements for use of Form S-3 under the 1933 Act and the 1933 Act
Regulations. At the time the Registration Statement became effective, the
Registration Statement complied, and as of the applicable Representation
Date will comply, in all material respects with the requirements of the
1933 Act and the 1933 Act Regulations (including Rule 415(a) of the 1933
Act Regulations) and the 1939 Act and the rules and regulations of the
Commission promulgated thereunder (the "1939 Act Regulations"). The
Registration Statement, at the time it became effective, did not, and at
each time thereafter at which any amendment to the Registration Statement
becomes effective or any Annual Report on Form 10-K is filed by the Company
with the Commission and as of each Representation Date, will not, contain
an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein
not misleading. No stop order suspending the effectiveness of the
Registration Statement has been issued under the 1933 Act and no
proceedings for that purpose have been instituted or are pending or, to the
knowledge of the Company, are contemplated by the Commission, and any
request on the part of the Commission for additional information has been
complied with. The Prospectus, as of the date hereof (unless the term
"Prospectus" refers to a prospectus which has been provided to the Agents
by the Company for use in connection with the offering of the Notes which
differs from the Prospectus filed with the Commission pursuant to Rule
424(b) of the 1933 Act Regulations, in which case at the time it is first
provided to the Agents for such use) does not, and as of each
Representation Date will not, include an untrue statement of a material
fact or omit to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading; provided,
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however, that the representations and warranties in this subsection shall
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not apply to statements in or omissions from the Registration Statement or
the Prospectus made in reliance upon and in conformity with information
furnished to the Company in writing by the Agents expressly for use in the
Registration Statement or the Prospectus or to that part of the
Registration Statement that constitutes the Statement of Eligibility and
Qualification of the Trustee under the 1939 Act filed as an exhibit to the
Registration Statement (the "Form T-1"). For purposes of this Section 2(a),
all references to the Registration Statement, any post-effective amendments
thereto and the Prospectus shall be deemed to include, without limitation,
any electronically transmitted copies thereof filed with the Commission
pursuant to its Electronic Data Gathering, Analysis, and Retrieval system
("EDGAR").
(iv) Incorporated Documents. The documents incorporated or deemed to
----------------------
be incorporated by reference into the Prospectus pursuant to Item 12 of
Form S-3 under the 1933 Act, at the time they were or hereafter are filed
with the Commission, complied and will comply in all material respects with
the requirements of the 1934 Act and the rules and regulations of the
Commission thereunder (the "1934 Act Regulations"), and, when read together
and with the other information in the Prospectus, at the respective times
the Registration Statement and any amendments thereto became effective and
at each Representation Date did not and will not contain an untrue
statement of a material fact or omit to state a material fact required to
be stated therein or necessary in order to make the statements therein, in
the light of the circumstances under which they were or are made, not
misleading.
(v) Independent Accountants. The accountants who certified the
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financial statements and supporting schedules included or incorporated by
reference in the Registration Statement and the Prospectus are independent
public accountants as required by the 1933 Act and the 1933 Act
Regulations.
(vi) Financial Statements. The financial statements and any
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supporting schedules of the Company and its consolidated subsidiaries
included or incorporated by reference in the Registration Statement and the
Prospectus present fairly the consolidated financial position of the
Company and its consolidated subsidiaries as at the dates indicated and the
results of their operations for the periods specified; and, except as
otherwise stated in the Registration Statement and the Prospectus, said
financial statements have been prepared in conformity with generally
accepted accounting principles applied on a consistent basis; and the
supporting schedules included or incorporated by reference in the
Registration Statement present fairly the information required to be stated
therein; and the selected financial data and the summary financial
information included or incorporated by reference in the Registration
Statement and the Prospectus present fairly the information shown therein
and have been compiled on a basis consistent with that of the audited
financial statements included in the Registration Statement and the
Prospectus; and the pro forma financial statements and the related notes
thereto (if any) included or incorporated by reference in the Registration
Statement and the Prospectus present fairly the information shown therein,
have been prepared in accordance with the Commission's
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rules and guidelines with respect to pro forma financial statements and
have been properly compiled on the bases described therein, and the
assumptions used in the preparation thereof are reasonable and the
adjustments used therein are appropriate to give effect to the transactions
and circumstances referred to therein; and the Company's ratios of earnings
to fixed charges included in the Prospectus under the caption "Ratio of
Earnings to Fixed Charges" and in Exhibit 12 to the Registration Statement
have been calculated in compliance with Item 503(d) of Regulation S-K of
the Commission.
(vii) Authorization and Validity of this Agreement, the Indenture and
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the Notes. This Agreement has been duly authorized, executed and delivered
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by the Company and, upon execution and delivery by the Agents, will be a
valid and legally binding agreement of the Company; the Indenture has been
duly authorized, executed and delivered by the Company and is a valid and
legally binding obligation of the Company enforceable in accordance with
its terms, except as enforcement thereof may be limited by bankruptcy,
insolvency, reorganization, moratorium or other similar laws relating to or
affecting the rights of creditors or by general equity principles; the
Notes have been duly and validly authorized for issuance, offer and sale
pursuant to this Agreement and, when issued, authenticated and delivered
pursuant to the provisions of this Agreement and the Indenture against
payment of the consideration therefor specified in the Prospectus or agreed
upon pursuant to the provisions of this Agreement, the Notes will
constitute valid and legally binding obligations of the Company enforceable
in accordance with their terms, except as enforcement thereof may be
limited by bankruptcy, insolvency, reorganization, moratorium or other
similar laws relating to or affecting the rights of creditors or by general
equity principles; the Notes will be substantially in the form heretofore
delivered to the Agents and conform in all material respects to all
statements relating thereto contained in the Prospectus; and each holder of
Notes will be entitled to the benefits of the Indenture.
(viii) No Material Adverse Change in Business. Since the respective
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dates as of which information is given in the Registration Statement and
the Prospectus, except as otherwise stated therein or contemplated thereby,
(a) there has been no material adverse change in the condition, financial
or otherwise, or in the earnings, business affairs or business prospects of
the Company and its subsidiaries considered as one enterprise, whether or
not arising in the ordinary course of business and (b) there have been no
transactions entered into by the Company or any of its subsidiaries other
than those in the ordinary course of business, which are material with
respect to the Company and its subsidiaries considered as one enterprise.
(ix) No Defaults or Conflicts. Neither the Company nor any of its
------------------------
subsidiaries is in violation of its charter or bylaws or in material
default in the performance or observance of any obligation, agreement,
covenant or condition contained in any contract, indenture, mortgage, loan
agreement, note, lease or other instrument to which the Company or any of
its subsidiaries is a party or by which it or any of them may be bound, or
to which any of the property or assets of the Company or any of its
subsidiaries is subject and in which the violation or default might result
in a material adverse change in
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the condition, financial or otherwise, or in the earnings, business affairs
or business prospects of the Company and its subsidiaries considered as one
enterprise; and the execution, delivery and performance of this Agreement
and the Indenture and the consummation of the transactions contemplated
herein and therein and compliance by the Company with its obligations
hereunder and thereunder have been duly authorized by all necessary
corporate action and will not conflict with or constitute a material breach
of, or material default under, or result in the creation or imposition of
any lien, charge or encumbrance upon any property or assets of the Company
or any of its subsidiaries pursuant to, any contract, indenture, mortgage,
loan agreement, note, lease or other instrument to which the Company or any
of its subsidiaries is a party or by which it or any of them may be bound
or to which any of the property or assets of the Company or any of its
subsidiaries is subject, nor will such action result in any violation of
the provisions of the charter or bylaws of the Company or any law,
administrative regulation or administrative or court order or decree.
(x) No Authorization, Approval or Consent Required. No consent,
----------------------------------------------
approval, authorization, order or decree of any court or governmental
authority or agency is required for the consummation by the Company of the
transactions contemplated by this Agreement or in connection with the
offering, issuance or sale of Notes hereunder, except such as may be
required under the 1933 Act or the 1933 Act Regulations or state securities
("Blue Sky") laws.
(xi) Legal Proceedings; Contracts. There is no action, suit or
----------------------------
proceeding before or by any court or governmental agency or body, domestic
or foreign, now pending, or, to the knowledge of the Company, threatened
against or affecting, the Company or any of its subsidiaries, which is
required to be disclosed in the Registration Statement (other than as
disclosed therein), or which might result in any material adverse change in
the condition, financial or otherwise, or in the earnings, business affairs
or business prospects of the Company and its subsidiaries considered as one
enterprise, or might materially and adversely affect the properties or
assets thereof or might materially and adversely affect the consummation of
this Agreement or the Indenture or any transaction contemplated hereby or
thereby; all pending legal or governmental proceedings to which the Company
or any of its subsidiaries is a party or of which any of their property or
assets is the subject which are not described in the Registration
Statement, including ordinary routine litigation incidental to the
business, are, considered in the aggregate, not material; and there are no
contracts or documents of the Company or any of its subsidiaries which are
required to be filed as exhibits to the Registration Statement by the 1933
Act or by the 1933 Act Regulations which have not been so filed.
(xii) Title to Property. The Company and its subsidiaries have good
-----------------
title to all real property or interests in real property owned by the
Company or any of its subsidiaries, in each case free and clear of all
liens, encumbrances and defects except such as are stated or incorporated
by reference in the Prospectus or such as would not materially adversely
affect the condition, financial or otherwise, or the earnings, business
affairs or business prospects of the Company and its subsidiaries
considered as one
8
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enterprise; the Company and its subsidiaries have obtained satisfactory
confirmations (consisting of policies of title insurance or commitments or
binders therefor or opinions of counsel based upon the examination of
abstracts) confirming, except as is otherwise described in the Prospectus,
(A) that the Company and its subsidiaries have the foregoing title to such
real property and interests in real property, and (B) that the instruments
securing the Company's and its subsidiaries' real estate mortgage loans
create valid liens upon the real properties described in such instruments
enjoying the priorities intended, subject only to exceptions to title which
have no material adverse effect on the value of such real properties and
interests in relation to the Company and its subsidiaries considered as one
enterprise; and no material real property and buildings are held under
lease by the Company (other than long-term ground leases).
(xiii) Investment Company Act. The Company is not required to be
----------------------
registered under the Investment Company Act of 1940, as amended (the "1940
Act").
(xiv) Rating of the Notes. The Medium-Term Note Program under which
-------------------
the Notes are issued (the "Program"), as well as the Notes, are rated
"Baa1" by Moody's Investors Service, Inc. and "BBB+" by Standard & Poor's
Ratings Group, or such other rating as to which the Company shall have most
recently notified the Agents pursuant to Section 4(a) hereof.
(b) Additional Certifications. Any certificate signed by any director
-------------------------
or officer of the Company and delivered to an Agent or to counsel for the
Agents in connection with an offering of Notes through an Agent as agent or
the sale of Notes to an Agent as principal shall be deemed a representation
and warranty by the Company to the Agent as to the matters covered thereby
on the date of such certificate and at each Representation Date subsequent
thereto.
Section 3. Purchases as Principal; Solicitations as Agent.
(a) Purchases as Principal. Unless otherwise agreed by an Agent and
----------------------
the Company, Notes shall be purchased by the Agents as principal. Such
purchases shall be made in accordance with terms agreed upon by an Agent
and the Company (which terms shall be agreed upon orally, with written
confirmation prepared by such Agent and mailed to the Company). An Agent's
commitment to purchase Notes as principal shall be deemed to have been made
on the basis of the representations and warranties of the Company herein
contained and shall be subject to the terms and conditions herein set
forth. Each such purchase of Notes by an Agent shall be made by such Agent
with the intention of reselling them as soon as practicable, in the sole
judgment of such Agent. Each purchase of Notes, unless otherwise agreed,
shall be at a discount from the principal amount of each such Note
equivalent to the applicable commission set forth in Schedule A hereto. An
Agent may engage the services of any other broker or dealer in connection
with the resale of the Notes purchased as principal and may allow any
portion of the discount received in connection with such purchases from the
Company to such brokers and dealers. At the time of each purchase of Notes
by an Agent as principal, such Agent
9
<PAGE>
shall specify the requirements for the stand-off agreement, officer's
certificate, opinion of counsel and comfort letter pursuant to Sections
4(k), 7(b), 7(c) and 7(d) hereof, respectively.
(b) Solicitations as Agent. On the basis of the representations and
----------------------
warranties herein contained, but subject to the terms and conditions herein
set forth, when agreed by the Company and an Agent, such Agent, as an agent
of the Company, will use its reasonable efforts to solicit offers to
purchase the Notes upon the terms and conditions set forth herein and in
the Prospectus. All Notes sold through an Agent as agent will be sold at
100% of their principal amount unless otherwise agreed to by the Company
and such Agent.
The Company reserves the right, in its sole discretion, to suspend
solicitation of offers to purchase the Notes through an Agent, as agent,
commencing at any time for any period of time or permanently. Upon receipt of
instructions from the Company, such Agent will forthwith suspend solicitation of
purchases from the Company until such time as the Company has advised such Agent
that such solicitation may be resumed.
The Company agrees to pay each Agent a commission, in the form of a
discount or otherwise as agreed to by the Company and such Agent, equal to the
applicable percentage of the principal amount of each Note sold by the Company
as a result of a solicitation made by such Agent as set forth in Schedule A
hereto.
(c) Administrative Procedures. The aggregate principal amount,
-------------------------
purchase price, interest rate or formula, maturity date and other terms of
the Notes (as applicable) specified in Exhibit A hereto shall be agreed
upon by the Company and the Agents and set forth in a pricing supplement to
the Prospectus to be prepared in connection with each sale of Notes.
Except as may be otherwise provided in such supplement to the Prospectus,
the Notes will be issued in denominations of $1,000 or any larger amount
that is an integral multiple of $1,000. Administrative procedures with
respect to the sale of Notes shall be agreed upon from time to time by the
Agents, the Company and the Trustee (the "Procedures"). The Agents and the
Company agree to perform the respective duties and obligations specifically
provided to be performed by them in the Procedures.
(d) Delivery of Closing Documents. The documents required to be
-----------------------------
delivered by Section 5 hereof shall be delivered at the offices of Latham &
Watkins, 633 West Fifth Street, Suite 4000, Los Angeles, California 90071-
2007 on the date hereof, or at such other time or place as the Agents and
the Company may agree.
Section 4. Covenants of the Company.
The Company covenants with each Agent as follows:
(a) Notice of Certain Events. The Company will notify the Agents
------------------------
immediately, and confirm the notice in writing (i) of the effectiveness of
any post-effective amendment
10
<PAGE>
to the Registration Statement, (ii) of the mailing or the delivery to the
Commission for filing of the Prospectus or any amendment to the
Registration Statement or amendment or supplement to the Prospectus or any
document to be filed pursuant to the 1934 Act which will be incorporated or
deemed to be incorporated by reference in the Prospectus, (iii) of the
receipt of any comments or inquiries from the Commission relating to the
Registration Statement or the Prospectus, (iv) of any request by the
Commission for any amendment to the Registration Statement or any amendment
or supplement to the Prospectus or for additional information, (v) of the
issuance by the Commission of any stop order suspending the effectiveness
of the Registration Statement or the initiation of any proceedings for that
purpose, (vi) of any change of which the Company has knowledge in the
rating assigned by any nationally recognized statistical rating
organization to the Program or any debt securities (including the Notes) of
the Company, or any public announcement of which the Company has knowledge
by any nationally recognized statistical rating organization that it has
under surveillance or review, with possible negative implications, its
rating of the Program or any such debt securities, or any withdrawal of
which the Company has knowledge by any nationally recognized statistical
rating organization of its rating of the Program or any such debt
securities, and (vii) of the issuance by any state securities commission or
other regulatory authority of any order suspending the qualification or the
exemption from qualification of the Notes under state securities or Blue
Sky laws or the initiation of any proceedings for that purpose. The Company
will make every reasonable effort to prevent the issuance by the Commission
of any stop order and, if any such stop order is issued, to obtain the
lifting thereof at the earliest possible moment.
(b) Notice of Certain Proposed Filings. The Company will give the
----------------------------------
Agents advance notice of its intention to file or prepare any additional
registration statement with respect to the registration of additional
Notes, any amendment to the Registration Statement or any amendment or
supplement to the Prospectus (other than an amendment or supplement
providing solely for a change in the interest rates, maturity or price of
Notes), whether by the filing of documents pursuant to the 1934 Act, the
1933 Act or otherwise, and will furnish the Agents with copies of any such
amendment or supplement or other documents proposed to be filed or prepared
a reasonable time in advance of such proposed filing or preparation, as the
case may be, and will not file any such amendment or supplement or other
documents in a form to which the Agents or counsel for the Agents shall
reasonably object.
(c) Copies of the Registration Statement and the Prospectus. The
-------------------------------------------------------
Company will deliver to the Agents as many signed and conformed copies of
the Registration Statement (as originally filed) and of each amendment
thereto (including exhibits filed therewith and documents incorporated or
deemed to be incorporated by reference in the Prospectus) as the Agents may
reasonably request. The Company will furnish to the Agents as many copies
of the Prospectus (as amended or supplemented) as the Agents shall
reasonably request for the purposes contemplated by the 1933 Act or the
1934 Act or the respective applicable rules and regulations of the
Commission thereunder so long as the Agents are
11
<PAGE>
required to deliver, under the 1933 Act or the 1934 Act, a Prospectus in
connection with sales or solicitations of offers to purchase the Notes.
(d) Preparation of Pricing Supplements. The Company will prepare,
----------------------------------
with respect to any Notes to be sold through or to an Agent pursuant to
this Agreement, a Pricing Supplement with respect to such Notes in a form
previously approved by such Agent and will file such Pricing Supplement
pursuant to Rule 424(b)(3) under the 1933 Act not later than the close of
business of the Commission on the fifth business day after the date on
which such Pricing Supplement is first used.
(e) Revisions of Prospectus -- Material Changes. Except as otherwise
-------------------------------------------
provided in subsection (l) of this Section, if at any time during the term
of this Agreement any event shall occur or condition exist as a result of
which it is necessary, in the opinion of counsel for the Agents or counsel
for the Company, to further amend or supplement the Prospectus in order
that the Prospectus will not include an untrue statement of a material fact
or omit to state any material fact necessary in order to make the
statements therein not misleading in the light of the circumstances
existing at the time the Prospectus is delivered to a purchaser, or if it
shall be necessary, in the opinion of either such counsel, to amend or
supplement the Registration Statement or the Prospectus in order to comply
with the requirements of the 1933 Act or the 1933 Act Regulations,
immediate notice shall be given, and confirmed in writing, to the Agents to
cease the solicitation of offers to purchase the Notes in the Agents'
capacity as agent and to cease sales of any Notes the Agents may then own
as principal, and the Company will promptly amend the Registration
Statement and the Prospectus, whether by filing documents pursuant to the
1934 Act, the 1933 Act or otherwise, as may be necessary to correct such
untrue statement or omission or to make the Registration Statement and
Prospectus comply with such requirements and the Company shall furnish to
the Agents as many copies of the Registration Statement and the Prospectus,
as each may then be amended or supplemented, as the Agents shall reasonably
require.
(f) Prospectus Revisions -- Periodic Financial Information. Except as
------------------------------------------------------
otherwise provided in subsection (1) of this Section, on or prior to the
date on which there shall be released to the general public interim
financial statement information related to the Company with respect to each
of the first three quarters of any fiscal year or preliminary financial
statement information with respect to any fiscal year, the Company shall
furnish such information to the Agents, confirmed in writing, and shall
prior to the delivery of the Prospectus to any purchaser of the Notes
purchasing after the date on which such financial information is released
to the general public, by the filing of documents pursuant to the 1934 Act,
the 1933 Act or otherwise cause the Prospectus to be amended or
supplemented to include or incorporate by reference financial information
with respect thereto and corresponding information for the comparable
period of the preceding fiscal year, as well as such other information and
explanations as shall be necessary for an understanding thereof or as shall
be required by the 1933 Act or the 1933 Act Regulations.
12
<PAGE>
(g) Prospectus Revisions -- Audited Financial Information. Except as
-----------------------------------------------------
otherwise provided in subsection (1) of this Section, on or prior to the
date on which there shall be released to the general public financial
information included in or derived from the audited financial statements of
the Company for the preceding fiscal year, the Company shall furnish such
information to the Agents, confirmed in writing, and shall, prior to the
delivery of the Prospectus to any purchaser of the Notes purchasing after
the date on which such financial information is released to the general
public, cause the Registration Statement and the Prospectus to be amended,
whether by the filing of documents pursuant to the 1934 Act, the 1933 Act
or otherwise, to include or incorporate by reference such audited financial
statements and the report or reports, and consent or consents to such
inclusion or incorporation by reference, of the independent accountants
with respect thereto, as well as such other information and explanations as
shall be necessary for an understanding of such financial statements or as
shall be required by the 1933 Act or the 1933 Act Regulations.
(h) Earnings Statements. The Company will make generally available to
-------------------
its security holders as soon as practicable, but not later than 60 days
after the close of the period covered thereby, an earnings statement (in
form complying with the provisions of Rule 158 of the 1933 Act Regulations)
covering each twelve month period beginning, in each case, not later than
the first day of the Company's fiscal quarter next following the "effective
date" (as defined in such Rule 158) of the Registration Statement with
respect to each sale of Notes.
(i) Blue Sky Qualifications. The Company will endeavor, in
-----------------------
cooperation with the Agents, to qualify the Notes for offering and sale
under the applicable securities laws of such states and other jurisdictions
of the United States as the Agents may designate, and will maintain such
qualifications in effect for as long as may be required for the
distribution of the Notes; provided, however, that the Company shall not be
obligated to file any general consent to service of process or to qualify
as a foreign corporation in any jurisdiction in which it is not so
qualified. The Company will file such statements and reports as may be
required by the laws of each jurisdiction in which the Notes have been
qualified as above provided. The Company will promptly advise the Agents
of the receipt by the Company of any notification with respect to the
suspension of the qualification of the Notes for sale in any such state or
jurisdiction or the initiating or threatening of any proceeding for such
purpose.
(j) 1934 Act Filings. The Company, during the period when the
----------------
Prospectus is required to be delivered under the 1933 Act or the 1934 Act,
will file promptly all documents required to be filed with the Commission
pursuant to Sections 13, 14 or 15 of the 1934 Act within the time periods
required by the 1934 Act and the 1934 Act Regulations and to the extent
such documents are incorporated by reference in the Prospectus, when read
together with the other information in or incorporated by reference into
the Prospectus, will not contain any untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary in
order to make the
13
<PAGE>
statements therein, in the light of the circumstances under which they are
made, not misleading.
(k) Stand-Off Agreement. If specified by an Agent in connection with
-------------------
a purchase by it of Notes as principal, between the date of the agreement
to purchase such Notes and the Settlement Date with respect to such
purchase, the Company will not, without such Agent's prior written consent,
directly or indirectly, offer or sell, or enter into any agreement to sell,
any debt securities of the Company (other than the Notes that are to be
sold pursuant to such agreement and commercial paper in the ordinary course
of business).
(l) Suspension of Certain Obligations. The Company shall not be
---------------------------------
required to comply with the provisions of subsections (e), (f) or (g) of
this Section during any period from the time (i) the Agents shall have
suspended solicitation of purchases of the Notes in their capacity as agent
pursuant to a request from the Company and (ii) no Agent shall then hold
any Notes purchased as principal pursuant hereto, until the time the
Company shall determine that solicitation of purchases of the Notes should
be resumed or an Agent shall subsequently purchase Notes from the Company
as principal.
(m) Use of Proceeds. The Company will use the net proceeds received
---------------
by it from the sale from time to time of Notes in the manner specified in
the Prospectus under "Use of Proceeds."
Section 5. Conditions of Obligations.
The obligations of one or more Agents to purchase Notes as principal and to
solicit offers to purchase the Notes as an agent of the Company, and the
obligations of any purchasers of the Notes sold through an Agent as agent, will
be subject to the accuracy of the representations and warranties on the part of
the Company herein and to the accuracy of the statements of the Company's
officers made in any certificate furnished pursuant to the provisions hereof, to
the performance and observance by the Company of all its covenants and
agreements herein contained and to the following additional conditions
precedent:
(a) Legal Opinions. On the date hereof, the Agents shall have
--------------
received the following legal opinions, dated as of the date hereof and in
form and scope satisfactory to the Agents:
(1) Opinion of Company Counsel. The opinion of Latham & Watkins, special
--------------------------
counsel to the Company, as set forth in Exhibit B hereto:
(2) The favorable opinion, dated as of Closing Time, of Latham & Watkins,
special counsel for the Company, subject to customary assumptions, limitations
and exceptions acceptable to counsel for the Agents, to the effect that:
14
<PAGE>
(i) the Company was organized in conformity with the requirements
for qualification as a real estate investment trust under the Code
commencing with its taxable year ending December 31, 1985, and its
proposed method of operation will enable it to meet the requirements
for qualification and taxation as a real estate investment trust under
the Code; and
(ii) the information in the Prospectus under the captions "Certain
Federal Income Tax Considerations to the Company" and "Material
Federal Income Tax Considerations," insofar as such statements
constitute matters of law, summaries of legal matters, documents or
proceedings, or legal conclusions, has been reviewed by them and is
accurate in all material respects.
(3) The favorable opinion of Ballard Spahr Andrews & Ingersoll, LLP,
Maryland counsel for the Company, to the effect that:
(i) The Company has been duly incorporated and is validly existing
as a corporation in good standing under the laws of the State of
Maryland.
(ii) The Company has the corporate power and authority to own, lease
and operate its properties and to conduct its business as described in
the Prospectus.
(iii) Texas HCP, Inc. has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State
of Maryland and has the corporate power and authority to own, lease
and operate its properties and to conduct its business as described in
the Prospectus. All of the issued and outstanding shares of capital
stock of such subsidiary have been duly authorized and validly issued,
and are fully paid and non-assessable and are owned by the Company,
directly or through subsidiaries, free and clear of any security
interest, mortgage, pledge, lien, encumbrance or claim.
(iv) The execution and delivery of this Agreement has been duly and
validly authorized by all necessary corporate action on the part of
the Company under its Charter and Bylaws and the Maryland General
Corporation Law (the "MGCL"). This Distribution Agreement has been
duly executed and delivered by the Company.
(v) The execution and delivery of the Indenture has been duly and
validly authorized by all necessary corporate action on the part of
the Company under its charter and bylaws and the MGCL. The Indenture
has been duly executed and delivered by the Company.
(vi) The issuance of the Notes pursuant to the Indenture, and the
offer and sale of the Notes pursuant to this Agreement, have been duly
authorized by all necessary corporate action on the part of the
Company under its charter and bylaws and the MGCL.
15
<PAGE>
(vii) The issuance and sale of the Notes by the Company and the
compliance by the Company with the provisions of this Agreement and
the Indenture and the consummation of the transactions contemplated
hereby and thereby, will not result in any violation of the provisions
of the charter or bylaws of the Company.
(viii) No authorization, approval, consent, decree or order of any
court or governmental authority or agency is required under the
Maryland General Corporation Law for the consummation by the Company
of the transactions contemplated by this Agreement or in connection
with the sale of the Notes hereunder, except such as may have been
obtained or rendered, as the case may be, or as may be required under
the 1933 Act or the 1933 Act Regulations or state securities laws.
In rendering its opinion, Ballard Spahr Andrews & Ingersoll, LLP
shall state that each of Brown & Wood llp, in rendering its opinion
pursuant to Section 5(a)(5), and Latham & Watkins, in rendering its
opinion pursuant to Section 5(a)(1), may rely upon such opinion as to
matters arising under the laws of the State of Maryland.
(4) Opinion of Company Counsel. The opinion of Edward J. Henning, General
--------------------------
Counsel of the Company, to the effect that:
(i) To the best of such counsel's knowledge and information, the
Company is duly qualified as a foreign corporation to transact
business and is in good standing in each jurisdiction in which its
ownership or lease of substantial properties or the conduct of its
business requires such qualification, except where the failure to so
qualify would not have a material adverse effect on the condition,
financial or otherwise, or the earnings, business affairs or business
prospects of the Company and its subsidiaries considered as one
enterprise.
(ii) To the best of such counsel's knowledge and information, each
Significant Subsidiary of the Company is duly qualified as a foreign
corporation to transact business and is in good standing in each
jurisdiction in which its ownership or lease of substantial properties
or the conduct of its business requires such qualification, except
where the failure to so qualify and be in good standing would not have
a material adverse effect on the condition, financial or otherwise, or
the earnings, business affairs or business prospects of the Company
and its subsidiaries considered as one enterprise.
(iii) To the best of such counsel's knowledge and information, no
material default exists in the due performance or observance by the
Company or any of its subsidiaries of any obligation, agreement,
covenant or condition contained in any contract, indenture, mortgage,
loan agreement, note, lease or other instrument described or referred
to in the Registration Statement or filed as an exhibit thereto or
incorporated by reference therein which would have a
16
<PAGE>
material adverse effect on the condition, financial or otherwise, or
the earnings, business affairs or business prospects of the Company
and its subsidiaries considered as one enterprise.
(iv) To the best of such counsel's knowledge and information, there
are no contracts, indentures, mortgages, loan agreements, notes,
leases or other instruments or documents required to be described or
referred to in the Registration Statement or to be filed as exhibits
thereto other than those described or referred to therein or filed or
incorporated by reference as exhibits thereto and the descriptions
thereof or references thereto are correct.
(v) The issue and sale of the Notes and the compliance by the
Company with the provisions of this Agreement and the Indenture, and
the consummation of the transactions contemplated herein and therein,
will not, to the best of such counsel's knowledge and information,
result in any material violation of any order known by such counsel to
be applicable to the Company of any court or governmental agency or
body having jurisdiction over the Company or any of its subsidiaries
or any of their properties.
(vi) To the best of such counsel's knowledge and information, there
are no legal or governmental proceedings pending or threatened which
are required to be disclosed in the Prospectus.
(5) Opinion of Counsel to the Agents. The opinion of Brown & Wood llp,
--------------------------------
counsel to the Agents, covering the matters referred to in paragraphs (i) to
(vi), inclusive, of Exhibit B and in subparagraph (a)(3) under the subheadings
(i) and (iv) to (vi), inclusive, above. In rendering such opinion, Brown & Wood
llp may rely upon the opinion of Ballard Spahr Andrews & Ingersoll, rendered
pursuant to Section 5(a)(3) as to matters arising under the laws of the State of
Maryland. Brown & Wood llp shall additionally state that nothing has come to
its attention that would lead it to believe that the Registration Statement, at
the time it became effective or, if an amendment to the Registration Statement
or an Annual Report on Form 10-K has been filed by the Company with the
Commission subsequent to the effectiveness of the Registration Statement, then
at the time such amendment became effective or at the time of the most recent
such filing, as the case may be, or at the date hereof, contained or contains an
untrue statement of a material fact or omitted or omits to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading, or that the Prospectus, as amended or supplemented at the date
hereof, as the case may be, contained or contains an untrue statement of a
material fact or omitted or omits to state a material fact necessary in order to
make the statements therein, in the light of the circumstances under which they
were made, not misleading; it being understood that such counsel shall express
no opinion with respect to the financial statements, schedules and other
financial data in the Registration Statement or the Prospectus.
In giving their opinions, Latham & Watkins and Brown & Wood llp may
rely, to the extent recited therein, (A) as to all matters of fact, upon
certificates and written statements of officers of the Company, and (B) as
to the qualification and good standing
17
<PAGE>
of the Company and each Significant Subsidiary to do business in any state
or jurisdiction, upon certificates of appropriate government officials.
(b) Officer's Certificate. At the date hereof, the Agents shall have
---------------------
received a certificate of the President or Vice President and the chief
financial or chief accounting officer of the Company, dated as of the date
hereof, to the effect that (i) since the respective dates as of which
information is given in the Registration Statement and the Prospectus or
since the date of any agreement by an Agent to purchase Notes as principal,
there has not been any material adverse change in the condition, financial
or otherwise, or in the earnings, business affairs or business prospects of
the Company and its subsidiaries considered as one enterprise, whether or
not arising in the ordinary course of business, (ii) the other
representations and warranties of the Company contained in Section 2 hereof
are true and correct with the same force and effect as though expressly
made at and as of the date of such certificate, (iii) the Company has
performed or complied with all agreements and satisfied all conditions on
its part to be performed or satisfied at or prior to the date of such
certificate, and (iv) no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for that purpose
have been initiated or, to the best knowledge and information of such
officer, threatened by the Commission.
(c) Comfort Letter. On the date hereof, the Agents shall have
--------------
received a letter from Arthur Andersen llp, dated as of the date hereof and
in form and substance satisfactory to the Agents, to the effect that:
(i) They are independent public accountants with respect to the
Company and its subsidiaries within the meaning of the 1933 Act and the
1933 Act Regulations.
(ii) In their opinion, the consolidated financial statements and
supporting schedule(s) of the Company and its subsidiaries examined by them
and included or incorporated by reference in the Registration Statement
comply as to form in all material respects with the applicable accounting
requirements of the 1933 Act and the 1933 Act Regulations with respect to
registration statements on Form S-3 and the 1934 Act and the 1934 Act
Regulations.
(iii) They have performed specified procedures, not constituting an
audit, including a reading of the latest available interim financial
statements of the Company and its indicated subsidiaries, a reading of the
minute books of the Company and such subsidiaries since the end of the most
recent fiscal year with respect to which an audit report has been issued,
inquiries of and discussions with certain officials of the Company and such
subsidiaries responsible for financial and accounting matters with respect
to the unaudited consolidated financial statements included or incorporated
by reference in the Registration Statement and Prospectus and the latest
available interim unaudited financial statements of the Company and its
subsidiaries, and such other inquiries and procedures as may be specified
in such letter, and on the basis of such inquiries and procedures nothing
came to their attention that caused them to believe that: (A) the unaudited
consolidated financial statements of the Company and its subsidiaries
included or
18
<PAGE>
incorporated by reference in the Registration Statement and Prospectus do
not comply as to form in all material respects with the applicable
accounting requirements of the 1934 Act and the 1934 Act Regulations or
were not fairly presented in conformity with generally accepted accounting
principles in the United States applied on a basis substantially consistent
with that of the audited financial statements included or incorporated by
reference therein, or (B) at a specified date not more than five days prior
to the date of such letter, there was any change in the consolidated
capital stock or any increase in consolidated long-term debt of the Company
and its subsidiaries or any decrease in the consolidated net assets of the
Company and its subsidiaries, in each case as compared with the amounts
shown on the most recent consolidated balance sheet of the Company and its
subsidiaries included or incorporated by reference in the Registration
Statement and Prospectus or, during the period from the date of such
balance sheet to a specified date not more than five days prior to the date
of such letter, there were any decreases, as compared with the
corresponding period in the preceding year, in consolidated revenues or net
income of the Company and its subsidiaries, except in each such case as set
forth in or contemplated by the Registration Statement and Prospectus or
except for such exceptions enumerated in such letter as shall have been
agreed to by the Agents and the Company.
(iv) In addition to the examination referred to in their report
included or incorporated by reference in the Registration Statement and the
Prospectus, and the limited procedures referred to in clause (iii) above,
they have carried out certain other specified procedures, not constituting
an audit, with respect to certain amounts, percentages and financial
information which are included or incorporated by reference in the
Registration Statement and Prospectus and which are specified by the
Agents, and have found such amounts, percentages and financial information
to be in agreement with the relevant accounting, financial and other
records of the Company and its subsidiaries identified in such letter.
(d) Other Documents. On the date hereof and on each Settlement Date,
---------------
counsel to the Agents shall have been furnished with such documents and
opinions as such counsel may reasonably require for the purpose of enabling
such counsel to pass upon the issuance and sale of Notes as herein
contemplated and related proceedings, or in order to evidence the accuracy
and completeness of any of the representations and warranties, or the
fulfillment of any of the conditions, herein contained; and all proceedings
taken by the Company in connection with the issuance and sale of Notes as
herein contemplated shall be satisfactory in form and substance to the
Agents and to counsel to the Agents.
If any condition specified in this Section 5 shall not have been fulfilled
when and as required to be fulfilled, this Agreement (or, at the option of an
Agent, any applicable agreement by such Agent to purchase Notes as principal)
may be terminated by the applicable Agent or Agents by notice to the Company at
any time and any such termination shall be without liability of any party to any
other party, except that the covenant regarding provision of an earnings
statement set forth in Section 4(h) hereof, the provisions concerning payment of
expenses under Section 10 hereof, the indemnity and contribution agreement set
forth in Sections 8 and 9 hereof,
19
<PAGE>
the provisions concerning the representations, warranties and agreements to
survive delivery in Section 11 hereof, the provisions relating to governing law
set forth in Section 14 and the provisions set forth under "Parties" of Section
15 hereof shall remain in effect.
Section 6. Delivery of and Payment for Notes Sold through an Agent.
Delivery of Notes sold through an Agent as agent shall be made by the
Company to such Agent for the account of any purchaser only against payment
therefor in immediately available funds.
Section 7. Additional Covenants of the Company.
The Company covenants and agrees with each Agent that:
(a) Reaffirmation of Representations and Warranties. Each acceptance
-----------------------------------------------
by it of an offer for the purchase of Notes (whether to such Agent as
principal or through such Agent as agent), and each delivery of Notes to
such Agent (whether to such Agent as principal or through such Agent as
agent), shall be deemed to be an affirmation that the representations and
warranties of the Company contained in this Agreement and in any
certificate theretofore delivered to such Agent pursuant hereto are true
and correct at the time of such acceptance or sale, as the case may be, and
an undertaking that such representations and warranties will be true and
correct at the time of delivery to the purchaser or its agent, or to such
Agent, of the Note or Notes relating to such acceptance or sale, as the
case may be, as though made at and as of each such time (and it is
understood that such representations and warranties shall relate to the
Registration Statement and Prospectus as amended and supplemented to each
such time).
(b) Subsequent Delivery of Certificates. Each time that (i) the
-----------------------------------
Registration Statement or the Prospectus shall be amended or supplemented
(other than by an amendment or supplement providing solely for the
establishment of or a change in the interest rates, maturity or price of
the Notes or similar changes, and, unless the Agents shall otherwise
specify, other than by an amendment or supplement which relates exclusively
to an offering of securities other than the Notes), (ii) there is filed
with the Commission any document incorporated by reference into the
Prospectus (other than any Current Report on Form 8-K relating exclusively
to the issuance of securities other than the Notes under the Registration
Statement, unless the Agents shall otherwise specify), (iii) (if required
in connection with the purchase of Notes by an Agent as principal) the
Company sells Notes to an Agent as principal or (iv) if the Company issues
and sells Notes in a form not previously certified to the Agents by the
Company, the Company shall furnish or cause to be furnished to the Agents
forthwith a certificate dated the date of filing with the Commission of
such supplement or document, the date of effectiveness of such amendment,
or the date of such sale, as the case may be, in form satisfactory to the
Agents to the effect that the statements contained in the certificate
referred to in Section 5(b) hereof which were last furnished to the Agents
are true and correct at the
20
<PAGE>
time of such amendment, supplement, filing or sale, as the case may be, as
though made at and as of such time (except that such statements shall be
deemed to relate to the Registration Statement and the Prospectus as
amended and supplemented to such time) or, in lieu of such certificate, a
certificate of the same tenor as the certificate referred to in said
Section 5(b), modified as necessary to relate to the Registration Statement
and the Prospectus as amended and supplemented to the time of delivery of
such certificate.
(c) Subsequent Delivery of Legal Opinions. Each time that (i) the
-------------------------------------
Registration Statement or the Prospectus shall be amended or supplemented
(other than by an amendment or supplement providing solely for the
establishment of or a change in the interest rates, maturity or price of
the Notes or similar changes or solely for the inclusion of additional
financial information, and, unless the Agents shall otherwise specify,
other than by an amendment or supplement which relates exclusively to an
offering of securities other than the Notes), (ii) there is filed with the
Commission any document incorporated by reference into the Prospectus
(other than any Current Report on Form 8-K relating exclusively to the
issuance of debt securities other than the Notes under the Registration
Statement), (iii) (if required in connection with the purchase of Notes by
an Agent as principal) the Company sells Notes to an Agent as principal or
(iv) if the Company issues and sells Notes in a form not previously
certified to the Agents by the Company, the Company shall furnish or cause
to be furnished forthwith to the Agents and to counsel to the Agents the
written opinions of Latham & Watkins, counsel for the Company, Ballard
Spahr Andrews & Ingersoll, Maryland counsel for the Company and Edward J.
Henning, General Counsel of the Company, or other counsel satisfactory to
the Agents dated the date of filing with the Commission of such supplement
or document, the date of effectiveness of such amendment, or the date of
such sale, as the case may be, in form and substance satisfactory to the
Agents, of the same tenor as the opinions referred to in Sections 5(a)(1),
5(a)(2), 5(a)(3) and 5(a)(4) hereof, but modified, as necessary, to relate
to the Registration Statement and the Prospectus as amended and
supplemented to the time of delivery of such opinion; or, in lieu of such
opinion, counsel last furnishing such opinion to the Agents shall furnish
the Agents with a letter to the effect that the Agents may rely on such
last opinion to the same extent as though it was dated the date of such
letter authorizing reliance (except that statements in such last opinion
shall be deemed to relate to the Registration Statement and the Prospectus
as amended and supplemented to the time of delivery of such letter
authorizing reliance).
(d) Subsequent Delivery of Comfort Letters. Each time that (i) the
--------------------------------------
Registration Statement or the Prospectus shall be amended or supplemented
to include additional financial information or there is filed with the
Commission any document incorporated by reference into the Prospectus which
contains additional financial information, or (ii) (if required in
connection with the purchase of Notes by an Agent as principal) the Company
sells Notes to an Agent as principal, the Company shall cause Arthur
Andersen llp (or other independent accountants of the Company satisfactory
to the Agents) forthwith to furnish the Agents a letter, dated the date of
effectiveness of such amendment, supplement or document filed with the
Commission, or the date of such sale, as the case may be, in form
satisfactory to the Agents, of the same tenor as the portions of
21
<PAGE>
the letter referred to in clauses (i) and (ii) of Section 5(c) hereof but
modified to relate to the Registration Statement and Prospectus, as amended
and supplemented to the date of such letter, and of the same general tenor
as the portions of the letter referred to in clauses (iii) and (iv) of said
Section 5(c) with such changes as may be necessary to reflect changes in
the financial statements and other information derived from the accounting
records of the Company; provided, however, that if the Registration
-------- -------
Statement or the Prospectus is amended or supplemented solely to include
financial information as of and for a fiscal quarter, Arthur Andersen & Co.
(or such other acceptable independent accountants) may limit the scope of
such letter to the unaudited financial statements included in such
amendment or supplement unless any other information included therein of an
accounting, financial or statistical nature is of such a nature that, in
the reasonable judgment of the Agents, such letter should cover such other
information.
Section 8. Indemnification.
(a) Indemnification of the Agents. The Company agrees to indemnify
-----------------------------
and hold harmless each Agent and each person, if any, who controls such
Agent within the meaning of Section 15 of the 1933 Act as follows:
(i) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, arising out of any untrue statement or alleged
untrue statement of a material fact contained in the Registration Statement
(or any amendment thereto), or any omission or alleged omission therefrom
of a material fact required to be stated therein or necessary to make the
statements therein not misleading or arising out of any untrue statement or
alleged untrue statement of a material fact contained in the Prospectus (or
any amendment or supplement thereto) or the omission or alleged omission
therefrom of a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading;
(ii) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, to the extent of the aggregate amount paid in
settlement of any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or of any claim
whatsoever based upon any such untrue statement or omission, or any such
alleged untrue statement or omission, if such settlement is effected with
the written consent of the Company; and
(iii) against any and all expense whatsoever, as incurred (including,
subject to Section 8(c) hereof, the fees and disbursements of counsel
chosen by such Agent) reasonably incurred in investigating, preparing or
defending against any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or any claim
whatsoever based upon any such untrue statement or omission, or any such
alleged untrue statement or omission, to the extent that any such expense
is not paid under (i) or (ii) above;
22
<PAGE>
provided, however, that this indemnity agreement shall not apply to any loss,
- -------- -------
liability, claim, damage or expense to the extent arising out of any untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to the Company by the
Agents expressly for use in the Registration Statement (or any amendment
thereto) or the Prospectus (or any amendment or supplement thereto), or made in
reliance upon the Trustee's Statement of Eligibility under the 1939 Act filed as
an exhibit to the Registration Statement.
(b) Indemnification of Company, Directors and Officers. Each Agent
--------------------------------------------------
severally agrees to indemnify and hold harmless the Company, its directors,
each of its officers who signed the Registration Statement, and each
person, if any, who controls the Company within the meaning of Section 15
of the 1933 Act against any and all loss, liability, claim, damage and
expense described in the indemnity contained in subsection (a) of this
Section, as incurred, but only with respect to untrue statements or
omissions, or alleged untrue statements or omissions, made in the
Registration Statement (or any amendment thereto) or the Prospectus (or any
amendment or supplement thereto) in reliance upon and in conformity with
written information furnished to the Company by the Agents expressly for
use in the Registration Statement (or any amendment thereto) or the
Prospectus (or any amendment or supplement thereto).
(c) Actions Against Parties; Notification. Each indemnified party
-------------------------------------
shall give written notice as promptly as reasonably practicable to each
indemnifying party of any action commenced against it in respect of which
indemnity may be sought hereunder, but failure to so notify an indemnifying
party shall not relieve such indemnifying party from any liability
hereunder to the extent it is not materially prejudiced as a result thereof
and in any event shall not relieve it from any liability which it may have
otherwise than on account of this indemnity agreement. In the case of
parties indemnified pursuant to Section 8(a) above, counsel to the
indemnified parties shall be selected by the applicable Agent(s) and, in
the case of parties indemnified pursuant to Section 8(b) above, counsel to
the indemnified parties shall be selected by the Company. An indemnifying
party may participate at its own expense in the defense of such action;
provided, however, that counsel to the indemnifying party shall not (except
-------- -------
with the consent of the indemnified party) also be counsel to the
indemnified party. In no event shall the indemnifying parties be liable
for the fees and expenses of more than one counsel (in addition to any
local counsel) separate from their own counsel for all indemnified parties
in connection with any one action or separate but similar or related
actions in the same jurisdiction arising out of the same general
allegations or circumstances. No indemnifying party shall, without the
prior written consent of the indemnified parties, settle or compromise or
consent to the entry of any judgment with respect to any litigation, or any
investigation or proceeding by any governmental agency or body, commenced
or threatened, or any claim whatsoever in respect of which indemnification
or contribution could be sought under this Section 8 or Section 9 hereof
(whether or not the indemnified parties are actual or potential parties
thereto), unless such settlement, compromise or consent (i) includes an
unconditional release of each indemnified party from all liability arising
out of such litigation, investigation, proceeding or claim and (ii) does
not include a statement as to or
23
<PAGE>
an admission of fault, culpability or a failure to act by or on behalf of
any indemnified party.
(d) Settlement without Consent if Failure to Reimburse. If at any
--------------------------------------------------
time an indemnified party shall have requested an indemnifying party to
reimburse the indemnified party for fees and expenses of counsel, such
indemnifying party agrees that it shall be liable for any settlement of the
nature contemplated by Section 8(a)(ii) effected without its written
consent if (i) such settlement is entered into more than 45 days after
receipt by such indemnifying party of the aforesaid request, (ii) such
indemnifying party shall have received notice of the terms of such
settlement at least 30 days prior to such settlement being entered into and
(iii) such indemnifying party shall not have reimbursed such indemnified
party in accordance with such request prior to the date of such settlement.
(e) EDGAR. For purposes of this Section 8, all references to the
-----
Registration Statement or the Prospectus, or any amendment or supplement to
any of the foregoing, shall be deemed to include, without limitation, any
electronically transmitted copies thereof filed with the Commission
pursuant to EDGAR.
Section 9. Contribution.
If the indemnification provided for in Section 8 hereof is for any reason
unavailable to or insufficient to hold harmless an indemnified party in respect
of any losses, liabilities, claims, damages or expenses referred to therein,
then each indemnifying party shall contribute to the aggregate amount of such
losses, liabilities, claims, damages and expenses incurred by such indemnified
party, as incurred, (i) in such proportion as is appropriate to reflect the
relative benefits received by the Company, on the one hand, and the applicable
Agent(s), on the other hand, from the offering of the Notes that were the
subject of the claim for indemnification or (ii) if the allocation provided by
clause (i) 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 Company, on the one hand, and of the
applicable Agent(s), on the other hand, in connection with the statements or
omissions which resulted in such losses, liabilities, claims, damages or
expenses, as well as any other relevant equitable considerations.
The relative benefits received by the Company, on the one hand, and the
applicable Agent(s), on the other hand, in connection with the offering of the
Notes that were the subject of the claim for indemnification shall be deemed to
be in the same respective proportions as the total net proceeds from the
offering of such Notes (before deducting expenses) received by the Company and
the total discount or commissions received by each applicable Agent, as the case
may be, bears to the aggregate initial offering price of such Notes.
The relative fault of the Company, on the one hand, and the applicable
Agent(s), on the other hand, shall be determined by reference to, among other
things, whether any such untrue or alleged untrue statement of a material fact
or omission or alleged omission to state a material fact relates to information
supplied by the Company or by the applicable Agent(s) and the parties'
24
<PAGE>
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission.
The Company and the applicable Agent(s) agree that it would not be just and
equitable if contribution pursuant to this Section 9 were determined by pro rata
allocation or by any other method of allocation which does not take account of
the equitable considerations referred to above in this Section 9. The aggregate
amount of losses, liabilities, claims, damages and expenses incurred by an
indemnified party and referred to above in this Section 9 shall be deemed to
include any legal or other expenses reasonably incurred by such indemnified
party in investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever based upon any such untrue or alleged untrue
statement or omission or alleged omission.
Notwithstanding the provisions of this Section 9, (i) no Agent shall be
required to contribute any amount in excess of the amount by which the total
discount or commission received by such Agent in connection with the offering of
the Notes that were the subject of the claim for indemnification exceeds the
amount of any damages which such Agent has otherwise been required to pay by
reason of any applicable untrue or alleged untrue statement or omission or
alleged omission and (ii) no person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the 1933 Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. In addition, in connection with an offering of Notes
purchased from the Company by two or more Agents as principal, the respective
obligations of such Agents to contribute pursuant to this Section 9 are several,
and not joint, in proportion to the aggregate principal amount of Notes that
each such Agent has agreed to purchase from the Company.
For purposes of this Section 9, each person, if any, who controls an Agent
within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act
shall have the same rights to contribution as such Agent, and each director of
the Company, each officer of the Company who signed the Registration Statement,
and each person, if any, who controls the Company within the meaning of Section
15 of the 1933 Act or Section 20 of the 1934 Act shall have the same rights to
contribution as the Company.
Section 10. Payment of Expenses.
The Company will pay all expenses incident to the performance of its
obligations under this Agreement, including:
(a) The preparation and filing of the Registration Statement and all
amendments thereto and the Prospectus and any amendments or supplements
thereto;
(b) The preparation, filing and reproduction of this Agreement;
(c) The preparation, printing, issuance and delivery of the Notes,
including any fees and expenses relating to the use of book-entry notes;
25
<PAGE>
(d) The fees and disbursements of the Company's accountants and
counsel, of the Trustee and its counsel, and of any Calculation Agent;
(e) The reasonable fees and disbursements of counsel to the Agents
incurred in connection with the establishment of the program relating to
the Notes and incurred from time to time in connection with the
transactions contemplated hereby;
(f) The qualification of the Notes under state securities laws in
accordance with the provisions of Section 4(i) hereof, including filing
fees and the reasonable fees and disbursements of counsel for the Agents in
connection therewith and in connection with the preparation of any Blue Sky
Survey and any Legal Investment Survey;
(g) The printing and delivery to the Agents in quantities as
hereinabove stated of copies of the Registration Statement and any
amendments thereto, and of the Prospectus and any amendments or supplements
thereto (including all documents incorporated by reference therein), and
the delivery by the Agents of the Prospectus and any amendments or
supplements thereto in connection with solicitations or confirmations of
sales of the Notes;
(h) The preparation, printing, reproducing and delivery to the Agents
of copies of the Indenture and all supplements and amendments thereto;
(i) Any fees charged by rating agencies for the rating of the Notes;
(j) Any advertising and other out-of-pocket expenses of the Agents
incurred with the approval of the Company;
(k) The cost of providing any CUSIP or other identification numbers
for the Notes; and
(l) The fees and expenses of any Depositary (as defined in the
Indenture) and any nominees thereof in connection with the Notes.
Section 11. Representations, Warranties and Agreements to Survive
Delivery.
All representations, warranties and agreements contained in this Agreement
or contained in certificates of officers of the Company submitted pursuant
hereto, shall remain operative and in full force and effect, regardless of any
investigation made by or on behalf of the Agents or any controlling person of
any Agent, or by or on behalf of the Company, and shall survive each delivery of
and payment for any of the Notes and the termination of this Agreement.
Section 12. Termination.
(a) Termination of this Agreement. This Agreement (excluding any
-----------------------------
agreement hereunder by one or more Agents to purchase Notes as principal)
may be terminated for
26
<PAGE>
any reason, at any time by either the Company or an Agent, as to itself,
upon the giving of ten days' written notice of such termination to the
other party hereto.
(b) Termination of Agreement to Purchase Notes as Principal. The
-------------------------------------------------------
applicable Agent(s) may terminate any agreement hereunder by such Agent(s)
to purchase Notes as principal, immediately upon notice to the Company, at
any time prior to the Settlement Date relating thereto (i) if there has
been, since the date of such agreement or since the respective dates as of
which information is given in the Registration Statement, any material
adverse change in the condition, financial or otherwise, or in the
earnings, business affairs or business prospects of the Company and its
subsidiaries considered as one enterprise, whether or not arising in the
ordinary course of business, or (ii) if there shall have occurred any
material adverse change in the financial markets in the United States or
any outbreak or escalation of hostilities or other national or
international calamity or crisis the effect of which is such as to make it,
in the judgment of such Agent(s), impracticable to market the Notes or
enforce contracts for the sale of the Notes, or (iii) if trading in any
securities of the Company has been suspended by the Commission or a
national securities exchange, or if trading generally on either the
American Stock Exchange or the New York Stock Exchange, or in the NASDAQ
National Market shall have been suspended, or minimum or maximum prices for
trading have been fixed, or maximum ranges for prices for securities have
been required, by any of said exchanges or by order of the Commission, the
NASD or any other governmental authority, or if a banking moratorium shall
have been declared by either Federal, California or New York authorities,
or (iv) if the rating assigned by any nationally recognized securities
rating agency to any debt securities of the Company as of the date of any
applicable principal purchase shall have been lowered since that date or if
any such rating agency shall have publicly announced that it has under
surveillance or review, with possible negative implications, its rating of
any debt securities of the Company, or (v) if there shall have come to such
Agent(s) attention any facts that would cause such Agent(s) to believe that
the Prospectus, at the time it was required to be delivered to a purchaser
of Notes, included an untrue statement of a material fact or omitted to
state a material fact necessary in order to make the statements therein, in
the light of the circumstances existing at the time of such delivery, not
misleading.
(c) General. In the event of any such termination, neither party will
-------
have any liability to the other party hereto, except that (i) the Agents
shall be entitled to any commission earned in accordance with the third
paragraph of Section 3(b) hereof, (ii) if at the time of termination (a)
any Agent shall own any Notes purchased by it as principal with the
intention of reselling them or (b) an offer to purchase any of the Notes
has been accepted by the Company but the time of delivery to the purchaser
or his agent of the Note or Notes relating thereto has not occurred, the
covenants set forth in Sections 4 and 7 hereof shall remain in effect until
such Notes are so resold or delivered, as the case may be, and (iii) the
covenant set forth in Section 4(h) hereof, the provisions of Section 10
hereof, the indemnity and contribution agreements set forth in Sections 8
and 9 hereof, and the provisions of Sections 11, 14 and 15 hereof shall
remain in effect.
27
<PAGE>
Section 13. Notices.
Unless otherwise provided herein, all notices required under the terms and
provisions hereof shall be in writing, either delivered by hand, by mail or by
telex, telecopier or telegram, and any such notice shall be effective when
received at the address specified below.
If to the Company:
Health Care Property Investors, Inc.
4675 MacArthur Court
9th Floor
Newport Beach, California 92660
Attention: Kenneth B. Roath,
President and Chief Executive Officer
Fax: (949) 221-0607
With a copy to:
Pamela B. Kelly, Esq.
Latham & Watkins
633 West Fifth Street
Los Angeles, California 90071
Fax: (213) 891-8763
If to the Agents:
Merrill Lynch & Co.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
North Tower - 10th Floor
World Financial Center
New York, New York 10281-1310
Attention: MTN Product Management
Fax: (212) 449-2234
Goldman, Sachs & Co.
85 Broad Street
New York, New York 10004
Attention: Alan Rifkin
Fax: (212) 902-3000
28
<PAGE>
NationsBanc Montgomery Securities LLC
100 N Tryon Street
7th Floor
Mail Stop NC 1007-07-01
Charlotte, North Carolina 28255
Attention: Lynn T. McConnell
Fax: (704) 388-9939
BNY Capital Markets, Inc.
One Wall Street, 18th Floor
New York, New York 10286
Attention: Daniel A. Klinger
Fax: (212)635-8525
or at such other address as such party may designate from time to time by notice
duly given in accordance with the terms of this Section 13.
Section 14. Governing Law; Forum.
This Agreement and all the rights and obligations of the parties shall be
governed by and construed in accordance with the laws of the State of California
applicable to agreements made and to be performed in such State.
Section 15. Parties.
This Agreement shall inure to the benefit of and be binding upon the Agents
and the Company and their respective successors. Nothing expressed or mentioned
in this Agreement is intended or shall be construed to give any person, firm or
corporation, other than the parties hereto and their respective successors and
the controlling persons and the officers and directors referred to in Sections 8
and 9 and their heirs and legal representatives, any legal or equitable right,
remedy or claim under or in respect of this Agreement or any provision herein
contained. This Agreement and all conditions and provisions hereof are intended
to be for the sole and exclusive benefit of the parties hereto and respective
successors and said controlling persons and said officers and directors and
their heirs and legal representatives, and for the benefit of no other person,
firm or corporation. No purchaser of Notes shall be deemed to be a successor by
reason merely of such purchase.
29
<PAGE>
If the foregoing is in accordance with the Agents understanding of our
agreement, please sign and return to the Company a counterpart hereof, whereupon
this instrument, along with all counterparts, will become a binding agreement
among the Agents and the Company in accordance with its terms.
Very truly yours,
HEALTH CARE PROPERTY INVESTORS, INC.
By: /s/ Edward J. Henning
------------------------------------
Title: Senior Vice President
Accepted:
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
By: /s/ Scott G. Primrose
----------------------------
Name: Scott G. Primrose
Title: Authorized Signatory
/s/ Goldman, Sachs & Co.
----------------------------
GOLDMAN, SACHS & CO.
NATIONSBANC MONTGOMERY SECURITIES LLC
By: /s/ Jennifer W. Arens
----------------------------
Name: Jennifer W. Arens
Title: Principal
BNY CAPITAL MARKETS, INC.
By: /s/ Daniel Klinger
-----------------------------
Name: Daniel Klinger
Title: Vice President
30
<PAGE>
SCHEDULE A
As compensation for the services of the Agents hereunder, the Company shall
pay it, on a discount basis, a commission for the sale of each Note equal to the
principal amount of such Note multiplied by the appropriate percentage set forth
below:
<TABLE>
<CAPTION>
PERCENT OF
MATURITY RANGES PRINCIPAL AMOUNT
- --------------- ----------------
<S> <C>
From 9 months to less than 1 year............................. 0.125%
From 1 year to less than 18 months............................ 0.150%
From 18 months to less than 2 years........................... 0.200%
From 2 years to less than 3 years............................. 0.250%
From 3 years to less than 4 years............................. 0.350%
From 4 years to less than 5 years............................. 0.450%
From 5 years to less than 6 years............................. 0.500%
From 6 years to less than 7 years............................. 0.550%
From 7 years to less than 10 years............................ 0.600%
From 10 years to less than 15 years........................... 0.625%
From 15 years to less than 20 years........................... 0.700%
From 20 years to 30 years..................................... 0.750%
More than 30 years............................................ *
</TABLE>
- ----------
* To be negotiated at the time of sale between the applicable Agent and the
Company.
1
<PAGE>
EXHIBIT A
The following terms, if applicable, shall be agreed to by the Agents and
the Company in connection with each sale of Notes:
Principal Amount: $_______
Interest Rate:
If Fixed Rate Note, Interest Rate:
If Floating Rate Note:
Interest Rate Basis:
Initial Interest Rate:
Spread or Spread Multiplier, if any:
Interest Reset Date(s):
Interest Payment Date(s):
Index Maturity:
Maximum Interest Rate, if any:
Minimum Interest Rate, if any:
Interest Reset Period:
Interest Payment Period:
Calculation Agent:
If Redeemable:
Initial Redemption Date:
Initial Redemption Percentage:
Annual Redemption Percentage Reduction:
If Repayable:
Optional Repayment Date(s):
Date of Maturity:
Purchase Price: ___%
Settlement Date and Time:
Denominations:
Additional Terms:
Also, in connection with the purchase of Notes by an Agent as principal,
agreement as to whether the following will be required:
Officer's Certificate pursuant to Section 7(b) of the Distribution
Agreement.
Legal Opinion pursuant to Section 7(c) of the Distribution Agreement.
Comfort Letter pursuant to Section 7(d) of the Distribution Agreement.
Stand-off Agreement pursuant to Section 4(k) of the Distribution Agreement.
1
<PAGE>
EXHIBIT B
August __, 1998
MERRILL LYNCH & CO.
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED
GOLDMAN, SACHS & CO.
NATIONSBANC MONTGOMERY SECURITIES LLC
BNY CAPITAL MARKETS, INC.
c\o Merrill Lynch & Co.
Merrill Lynch, Pierce, Fenner & Smith Incorporated
Merrill Lynch World Headquarters
North Tower, 10th Floor
World Financial Center
New York, New York 10281-1209
Re: Health Care Property Investors, Inc.
$150,000,000 Medium-Term Notes, Series D
----------------------------------------
Ladies and Gentlemen:
We have acted as special counsel to Health Care Property Investors, Inc., a
Maryland corporation (the "Company"), in connection with the registration under
the 1933 Act and the issuance of up to an aggregate initial offering price of
$150,000,000 Medium-Term Notes, Series D, due nine months or more from date of
issue, having such terms and provisions to be established as set forth in an
Officers' Certificate dated August __, 1998 delivered pursuant to Section 301 of
the Indenture dated as of September 1, 1993 between the Company and The Bank of
New York, as trustee (the "Notes").
This opinion is being rendered to you pursuant to Section 5(a)(1) of the
Distribution Agreement dated as of August __, 1998 among Merrill Lynch & Co.,
Merrill Lynch, Pierce, Fenner & Smith Incorporated, Goldman, Sachs & Co.,
NationsBanc Montgomery Securities LLC, BNY Capital Markets, Inc. and the
Company. Capitalized terms defined in the Distribution Agreement, used herein
and not otherwise defined herein shall have the meanings given them in the
Distribution Agreement.
1
<PAGE>
As such counsel, we have examined such matters of fact and questions of law
as we have considered appropriate for purposes of rendering the opinions
expressed below. We have examined, among other things, the following:
(a) the Distribution Agreement;
(b) the Indenture;
(c) the form of the Notes; and
(d) (i) that certain indenture dated as of April 1, 1989 between the
Company and The Bank of New York, as Trustee, for debt securities; (ii) that
certain Fiscal Agency Agreement dated as of November 8, 1993 between the Company
and Chemical Bank, as Fiscal Agent, for 6% Convertible Subordinated Notes due
2000; (iii) that certain $50,000,000 Revolving Credit Agreement dated as of
October 22, 1997 among the Company, The Bank of New York, as agent, The Sumitomo
Bank, Bank of Montreal, Kredietbank N.V., Wells Fargo Bank, Bank of Hawaii and
NationsBank of Texas, N.A. and (iv) that certain Revolving Credit Agreement
dated as of October 22, 1997 among the Company, The Bank of New York, as agent,
The Sumitomo Bank, Bank of Montreal, Kredietbank N.V., Wells Fargo Bank, Bank of
Hawaii and NationsBank of Texas, N.A. (collectively, the "Material Agreements").
In our examination, we have assumed the genuineness of all signatures, the
authenticity of all documents submitted to us as originals and the conformity to
authentic original documents of all documents submitted to us as copies.
As to facts material to the opinions, statements and assumptions expressed
herein, we have, with your consent, relied exclusively upon oral or written
statements and representations of officers and other representations of the
Company and others. In addition, we have obtained and relied upon such
certificates and assurances from public officials as we have deemed necessary.
We are opining herein as to the effect on the subject transaction only of
the federal laws of the United States and the internal laws of the State of
California, and we express no opinion with respect to the applicability thereto,
or the effect thereon, of the laws of any other jurisdiction or as to any
matters of municipal law or the laws of any local agencies within any state. We
understand that various matters concerning the laws of the State of Maryland are
addressed in an opinion of Ballard Spahr Andrews & Ingersoll separately provided
to you, and we express no opinion with respect to those matters. In rendering
the opinions set forth below, we have, with your permission, assumed that the
Company is duly incorporated and is validly existing as a corporation in good
standing under the laws of the State of Maryland; that each of the Distribution
Agreement, the Indenture and the Notes has been duly authorized, executed and
delivered by the Company; and that none of the issuance and sale of the Notes by
the Company, or the performance and compliance by the Company with the
provisions of the Distribution Agreement, the Indenture or the Notes, or the
consummation of the transactions
2
<PAGE>
contemplated thereby, will result in any violation of the provisions of the
charter or bylaws of the Company.
Our opinions set forth in paragraphs (vii) and (viii) below are based upon
our consideration of only those statutes, rules and regulations which, in our
experience, are normally applicable to the issuance and sale of debt securities.
Subject to the foregoing, and the other matters set forth herein, it is our
opinion that, as of the date hereof:
(i) The Indenture is a legally valid and binding agreement of the
Company, enforceable against the Company in accordance with its terms.
(ii) The Indenture has been duly qualified under the 1939 Act.
(iii) The Registration Statement has been declared effective under the
1933 Act and, based solely on telephonic confirmation with the Commission, no
stop order suspending the effectiveness of the Registration Statement has been
issued under the 1933 Act and no proceedings therefor have been initiated or
threatened by the Commission.
(iv) The Registration Statement at the time it became effective and at
the Representation Date, appeared on its face to comply as to form in all
material respects with the requirements for registration statements on Form S-3
under the 1933 Act and the 1933 Act Regulations; it being understood that we
express no opinion with respect to documents incorporated by reference therein
except as set forth in paragraph (ix) below, the Form T-1 or the financial
statements, schedules and other financial data included or incorporated by
reference in the Registration Statement. In passing upon the compliance as to
form of the Registration Statement, we have assumed that the statements made and
incorporated by reference therein are true, correct and complete.
(v) The Notes are in due and proper form and, when executed and
authenticated in accordance with the terms of the Indenture and delivered
pursuant to the provisions of the Distribution Agreement against payment of the
consideration therefor, will be legally valid and binding obligations of the
Company, enforceable against the Company in accordance with their terms and each
holder of Notes will be entitled to the benefits of the Indenture.
(vi) The Notes and the Indenture conform in all material respects to the
respective descriptions thereof contained in the Prospectus.
(vii) The issue and sale of the Notes and the compliance by the Company
with the provisions of the Distribution Agreement and the Indenture, and the
consummation of the transactions therein contemplated, will not result in a
breach or violation of any material term or provision of, or constitute a
default under, the Material Agreements; nor will such action result in any
material violation of any statute, rule or regulation
3
<PAGE>
applicable to the Company of any court or governmental agency or body having
jurisdiction over the Company or any of its subsidiaries or any of their
properties (other than federal or state securities law, which are specifically
addressed elsewhere herein).
(viii) No approval, authorization, consent, order or decree of any
Federal or California court or governmental authority or agency is required for
the consummation by the Company of the transactions contemplated by the
Distribution Agreement or in connection with the sale of the Notes thereunder,
except such as may have been obtained or rendered, as the case may be, or as may
be required under the 1933 Act or the 1933 Act Regulations or state securities
laws (including real estate syndication laws).
(ix) Each document filed pursuant to the 1934 Act and incorporated or
deemed to be incorporated by reference in the Prospectus (other than the
financial statements, schedules and other financial data included or
incorporated by reference therein, as to which we express no opinion), at the
time it was filed with the Commission, appeared on its face to comply as to form
in all material respects with the requirements of the 1934 Act and the 1934 Act
Regulations. In passing upon compliance as to form of such documents, we have
assumed that the statements made therein are true, correct and complete.
(x) The Company is not an "investment company" within the meaning of the
Investment Company Act of 1940, as amended.
In addition, we have participated in conferences with officers and other
representatives of the Company, representatives of the independent public
accountants for the Company, and your representatives, at which the contents of
the Registration Statement and the Prospectus and related matters were discussed
and, although we are not passing upon, and do not assume any responsibility for,
the accuracy, completeness or fairness of the statements contained or
incorporated by reference in the Registration Statement and the Prospectus and
have not made any independent check or verification thereof, during the course
of such participation, no facts came to our attention that caused us to believe
that the Registration Statement, at the time it became effective, contained an
untrue statement of a material fact or omitted to state a material fact required
to be stated therein or necessary to make the statements therein not misleading,
or that the Prospectus, as of its date or as of the date hereof, contained or
contains an untrue statement of a material fact or omitted or omits to state a
material fact required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading; it being understood that we express no belief with respect to the
financial statements, schedules and other financial data included or
incorporated by reference in the Registration Statement or the Prospectus or
with respect to the Form T-1.
The opinions rendered in paragraphs (i) and (v) above relating to the
enforceability of the Indenture and the Notes, respectively, are subject to the
following exceptions, limitations and qualifications: (1) the effect of
bankruptcy, insolvency,
4
<PAGE>
reorganization, moratorium, fraudulent conveyance or other similar laws now or
hereinafter in effect relating to or affecting the rights and remedies of
creditors; (2) the effect of general principles of equity, including without
limitation concepts of materiality, reasonableness, good faith and fair dealing
and the possible unavailability of specific performance or injunctive relief
(regardless of whether enforcement is sought in a proceeding in equity or at
law); and (3) certain rights, remedies and waivers contained in the Indenture
may be limited or rendered ineffective by applicable California laws or judicial
decisions governing such provisions, but such laws or judicial decisions do not
render the Indenture or the Notes invalid or unenforceable as a whole.
To the extent that the obligations of the Company under the Indenture and
with respect to the Notes may be dependent upon such matters, we assume for
purposes of this opinion that the Trustee has complied with any applicable
requirement to file returns and pay taxes under the laws of the State of
California; that the Trustee is duly organized, validly existing and in good
standing under the laws of its jurisdiction of organization; that the Trustee is
duly qualified to engage in the activities contemplated by the Indenture; that
the Indenture has been duly authorized, executed and delivered by the Trustee
and constitutes the legally valid and binding obligation of the Trustee
enforceable against the Trustee in accordance with its terms; the Trustee is in
compliance, generally and with respect to acting as a trustee under the
Indenture, with all applicable laws and regulations, and will be duly qualified
under the Trust Indenture Act; that the Trustee has the requisite organizational
and legal power and authority to perform its obligations under the Indenture;
and that the Notes will be paid for in accordance with the terms of the
Distribution Agreement, and will be duly authenticated by the Trustee in
accordance with the Indenture and the Officers' Certificate (as defined in the
Indenture).
This opinion is rendered only to you and is solely for your benefit in
connection with the transactions covered hereby. This opinion may not be relied
upon by you for any other purpose, or furnished to, quoted to or relied upon by
any other person, firm or corporation for any purpose, without our prior written
consent.
Very truly yours,
5
<PAGE>
EXHIBIT 1.2
================================================================================
5,000,000 Shares
HEALTH CARE PROPERTY INVESTORS, INC.
(a Maryland corporation)
Preferred Stock
(Par Value $1.00 Per Share)
PURCHASE AGREEMENT
------------------
================================================================================
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Section 1. Representations and Warranties....................................... 3
(i) Compliance with Registration Requirements...................... 3
(ii) Incorporated Documents......................................... 4
(iii) Independent Accountants........................................ 4
(iv) Financial Statements........................................... 4
(v) No Material Adverse Change in Business......................... 4
(vi) Good Standing of the Company................................... 5
(vii) Good Standing of Subsidiaries.................................. 5
(viii) REIT Status.................................................... 6
(ix) Capitalization................................................. 6
(x) Absence of Defaults and Conflicts.............................. 6
(xi) Absence of Proceedings......................................... 6
(xii) Absence of Further Requirements................................ 7
(xiii) Authorization of Purchase Agreement............................ 7
(xiv) Title to Property.............................................. 7
(xv) Investment Company Act......................................... 7
(xvi) Rating of the Securities....................................... 8
Section 2. Sale and Delivery to Underwriters; Closing........................... 8
Section 3. Covenants of the Company............................................. 9
(a) Compliance with Securities Regulations and Commission Requests. 9
(b) Filing of Amendments........................................... 10
(c) Delivery of Registration Statements............................ 10
(d) Delivery of Prospectuses....................................... 10
(e) Continued Compliance with Securities Laws...................... 10
(f) Blue Sky Qualifications........................................ 10
(g) Earnings Statement............................................. 11
(h) Use of Proceeds................................................ 11
(i) Preparation of Prospectus Supplement........................... 11
(j) Reporting Requirements......................................... 11
(k) Lock-up Period................................................. 11
Section 4. Payment of Expenses.................................................. 11
Section 5. Conditions of Underwriters' Obligations.............................. 12
(a) Effectiveness of Registration Statement........................ 12
(b) Opinions....................................................... 12
(c) Officers' Certificate.......................................... 16
(d) Accountant's Comfort Letter.................................... 16
(e) Bring-down Comfort Letter...................................... 17
(f) Listing........................................................ 17
</TABLE>
i
<PAGE>
<TABLE>
<S> <C> <C>
(g) Maintenance of Rating.......................................... 17
(h) Additional Documents........................................... 17
(i) Over-allotment Option.......................................... 17
Section 6. Indemnification...................................................... 19
(a) Indemnification of the Underwriter............................. 19
(b) Indemnification of Company, Directors and Officers............. 20
(c) Actions Against Parties; Notification.......................... 20
(d) Settlement without Consent if Failure to Reimburse............. 21
(e) EDGAR.......................................................... 21
Section 7. Contribution........................................................ 21
Section 8. Representations, Warranties and Agreements to Survive Delivery...... 22
Section 9. Termination of Agreement............................................ 22
Section 10. Default by One or More of the Underwriters......................... 23
Section 11. Notices............................................................ 24
Section 12. Parties............................................................ 24
Section 13. Governing Law and Time............................................. 24
</TABLE>
ii
<PAGE>
5,000,000 Shares
HEALTH CARE PROPERTY INVESTORS, INC.
(a Maryland corporation)
8.70% Series B
Cumulative Redeemable Preferred Stock
(Liquidation Preference $25 Per Share)
PURCHASE AGREEMENT
------------------
September 1, 1998
Merrill Lynch & Co.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
Morgan Stanley & Co. Incorporated
PaineWebber Incorporated
Prudential Securities Incorporated
Salomon Smith Barney Inc.
as Representatives of the several Underwriters
c/o Merrill Lynch & Co.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
Merrill Lynch World Headquarters
North Tower
World Financial Center
New York, New York 10281-1209
Dear Sirs:
Health Care Property Investors, Inc., a Maryland corporation (the
"Company"), confirms its agreement with each of Merrill Lynch, Pierce, Fenner &
Smith Incorporated ("Merrill Lynch"), Morgan Stanley & Co. Incorporated,
PaineWebber Incorporated, Prudential Securities Incorporated and Salomon Smith
Barney Inc. (collectively, the "Underwriters"), which term shall also include
any Underwriter substituted as hereinafter provided in Section 10), for whom
Merrill Lynch is acting as a representative (in such capacity, Merrill Lynch
shall hereinafter be referred
<PAGE>
to as the "Representative"), with respect to the sale by the Company and the
purchase by the Underwriters, acting severally and not jointly, of the
respective numbers of shares of 8.70% Series B Cumulative Redeemable Preferred
Stock (Liquidation Preference $25 per share) of the Company ("Series B Preferred
Stock") set forth in Schedule A hereto, and with respect to the grant by the
Company to the Underwriters, acting severally and not jointly, of the option
described in Section 2(b) hereof to purchase all or any part of 750,000
additional shares of Series B Preferred Stock to cover over-allotments. The
aforesaid 5,000,000 shares of Series B Preferred Stock (the "Initial
Securities") to be purchased by the Underwriters and all or any part of the
shares of Series B Preferred Stock subject to the option described in Section
2(b) hereof (the "Option Securities") are collectively hereinafter called the
"Securities."
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3 (No. 333-57163) and a related
preliminary prospectus for the registration under the Securities Act of 1933, as
amended (the "1933 Act") of Common Stock, par value $1.00 per share ("Common
Stock"), preferred stock, par value $1.00 per share ("Preferred Stock"),
including the Securities, and debt securities (collectively, the "Registered
Securities"), which registration statement has been declared effective by the
Commission and copies of which have heretofore been delivered to you. Such
registration statement, in the form in which it was declared effective, as
amended through the date hereof, including all documents incorporated or deemed
to be incorporated by reference therein through the date hereof, is hereinafter
referred to as the "Original Registration Statement." Any registration
statement filed pursuant to Rule 462(b) of the rules and regulations of the
Commission under the 1933 Act (the "1933 Act Regulations") is herein referred to
as the "Rule 462(b) Registration Statement." The Original Registration
Statement, together with any Rule 462(b) Registration Statement, is hereinafter
referred to as the "Registration Statement." The Company proposes to file with
the Commission pursuant to Rule 424(b) of the 1933 Act Regulations the
Prospectus Supplement (as defined in Section 3(i) hereof) relating to the
Securities and the prospectus dated August 27, 1998 (the "Base Prospectus")
relating to the Registered Securities, and has previously advised you of all
further information (financial and other) with respect to the Company set forth
therein. The Base Prospectus together with the Prospectus Supplement, in their
respective forms on the date hereof (being the forms in which they are to be
filed with the Commission pursuant to Rule 424(b) of the 1933 Act Regulations),
including all documents incorporated or deemed to be incorporated by reference
therein through the date hereof, are hereinafter referred to as, collectively,
the "Prospectus," except that if any revised prospectus or prospectus supplement
shall be provided to the Underwriters by the Company for use in connection with
the offering and sale of the Securities which differs from the Prospectus
(whether or not such revised prospectus or prospectus supplement is required to
be filed by the Company pursuant to Rule 424(b) of the 1933 Act Regulations),
the term "Prospectus" shall refer to such revised prospectus or prospectus
supplement, as the case may be, from and after the time it is first provided to
the Underwriters for such use. Unless the context otherwise requires, all
references in this Agreement to documents, financial statements and schedules
and other information which is "contained", "included", "stated", "described in"
or "referred to" in the Registration Statement or the Prospectus (and all other
references of like import) shall be deemed to mean and include all such
documents, financial statements and schedules and other information which is or
is deemed to be incorporated by reference in the
2
<PAGE>
Registration Statement or the Prospectus, as the case may be; and all references
in this Agreement to amendments or supplements to the Registration Statement or
the Prospectus shall be deemed to mean and include the filing of any document
under the Securities Exchange Act of 1934 (the "1934 Act") after the date of
this Agreement which is or is deemed to be incorporated by reference in the
Registration Statement or the Prospectus, as the case may be.
The Company understands that the Underwriters propose to make a public
offering of the Securities as soon as the Underwriters deem advisable after this
Agreement has been executed and delivered.
Section 1. Representations and Warranties.
------------------------------
(a) The Company represents and warrants to each Underwriter as of the date
hereof (such date being hereinafter referred to as the "Representation Date")
and as of the Closing Time referred to in Section 2 as follows:
(i) Compliance with Registration Requirements. The Company meets the
-----------------------------------------
requirements for use of Form S-3 under the 1933 Act and the 1933 Act
Regulations. Each of the Original Registration Statement and any Rule
462(b) Registration Statement and the Base Prospectus, at the respective
times the Original Registration Statement, any Rule 462(b) Registration
Statement and any post-effective amendments thereto became effective and as
of the Representation Date, complied and comply in all material respects
with the requirements of the 1933 Act and the 1933 Act Regulations
(including Rule 415(a) of the 1933 Act Regulations), and did not and as of
the Representation Date do 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. No stop order
suspending the effectiveness of the Original Registration Statement or any
Rule 462(b) Registration Statement has been issued under the 1933 Act and
no proceedings for that purpose have been instituted or are pending or, to
the knowledge of the Company, are contemplated by the Commission, and any
request on the part of the Commission for additional information has been
complied with. The Prospectus, at the Representation Date (unless the term
"Prospectus" refers to a prospectus which has been provided to the
Underwriters by the Company for use in connection with the offering of the
Securities which differs from the Prospectus filed with the Commission
pursuant to Rule 424(b) of the 1933 Act Regulations, in which case at the
time it is first provided to the Underwriters for such use) and at the
Closing Time referred to in Section 2 hereof, does not and will not include
an untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided,
--------
however, that the representations and warranties in this subsection (i)
-------
shall not apply to statements in or omissions from the Registration
Statement or Prospectus made in reliance upon and in conformity with
information furnished to the Company in writing by any Underwriter through
Merrill Lynch expressly for use in the Registration Statement or the
Prospectus or the information contained in any Statement of Eligibility and
Qualification of a trustee
3
<PAGE>
under the Trust Indenture Act of 1939, as amended (the "1939 Act") filed as
an exhibit to the Registration Statement (a "Form T-1"). For purposes of
this Section 1(a), all references to the Registration Statement, any post-
effective amendments thereto and the Prospectus shall be deemed to include,
without limitation, any electronically transmitted copies thereof filed
with the Commission pursuant to its Electronic Data Gathering, Analysis,
and Retrieval system ("EDGAR").
(ii) Incorporated Documents. The documents incorporated or deemed to
----------------------
be incorporated by reference into the Prospectus pursuant to Item 12 of
Form S-3 under the 1933 Act, at the time they were or hereafter are filed
with the Commission, complied and will comply in all material respects with
the requirements of the 1934 Act and the rules and regulations of the
Commission thereunder (the "1934 Act Regulations"), and, when read together
and with the other information in the Prospectus, at the respective times
the Registration Statement and any amendments thereto became effective, at
the Representation Date and at Closing Time, did not, do not and will not
contain an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading.
(iii) Independent Accountants. The accountants who certified the
-----------------------
financial statements and supporting schedules included or incorporated by
reference in the Registration Statement and Prospectus are independent
public accountants as required by the 1933 Act and the 1933 Act
Regulations.
(iv) Financial Statements. The financial statements and any
--------------------
supporting schedules of the Company and its consolidated subsidiaries
included or incorporated by reference in the Registration Statement and the
Prospectus present fairly the consolidated financial position of the
Company and its consolidated subsidiaries as at the dates indicated and the
results of their operations for the periods specified; and, except as
otherwise stated in the Registration Statement and the Prospectus, said
financial statements have been prepared in conformity with generally
accepted accounting principles applied on a consistent basis; and the
supporting schedules included or incorporated by reference in the
Registration Statement present fairly the information required to be stated
therein; the selected financial data and the summary financial information
included in the Prospectus present fairly the information shown therein and
have been compiled on a basis consistent with that of the audited financial
statements included in the Registration Statement and the Prospectus; the
pro forma financial statements and the related notes thereto included in
documents incorporated or deemed to be incorporated by reference in the
Registration Statement and the Prospectus present fairly the information
shown therein, have been prepared in accordance with the Commission's rules
and guidelines with respect to pro forma financial statements and have been
properly compiled on the bases described therein, and the assumptions used
in the preparation thereof are reasonable and the adjustments used therein
are appropriate to give effect to the transactions and circumstances
referred to therein; and the Company's ratios of earnings to fixed charges
included in the Prospectus under the caption "Ratio of Earnings to Fixed
Charges" and in
4
<PAGE>
Exhibit 12 to the Registration Statement have been calculated in compliance
with Item 503(d) of Regulation S-K of the Commission.
(v) No Material Adverse Change in Business. Since the respective
--------------------------------------
dates as of which information is given in the Registration Statement and
the Prospectus, except as otherwise stated therein or contemplated thereby,
(A) there has been no material adverse change in the condition, financial
or otherwise, or in the earnings, business affairs or business prospects of
the Company and its subsidiaries considered as one enterprise, whether or
not arising in the ordinary course of business, (B) there have been no
transactions entered into by the Company or any of its subsidiaries, other
than those in the ordinary course of business, which are material with
respect to the Company and its subsidiaries considered as one enterprise,
and (C) except for regular quarterly dividends on the Common Stock and the
Company's 7 7/8% Series A Cumulative Redeemable Preferred Stock, there has
been no dividend or distribution of any kind declared, paid or made by the
Company on any class of its capital stock.
(vi) Good Standing of the Company. The Company has been duly
----------------------------
incorporated and is validly existing as a corporation in good standing
under the laws of the State of Maryland with corporate power and authority
to own, lease and operate its properties and to conduct its business as
described in the Prospectus; the Company is duly qualified as a foreign
corporation to transact business and is in good standing in each
jurisdiction in which such qualification is required, whether by reason of
the ownership or leasing of property or the conduct of business, except
where the failure to so qualify and be in good standing would not have a
material adverse effect on the condition, financial or otherwise, or the
earnings, business affairs or business prospects of the Company and its
subsidiaries considered as one enterprise; and the Company is in
substantial compliance with all laws, ordinances and regulations of each
state in which it owns properties that are material to the properties and
business of the Company and its subsidiaries considered as one enterprise
in such state.
(vii) Good Standing of Subsidiaries. Each subsidiary of the Company
-----------------------------
which is a significant subsidiary (each, a "Significant Subsidiary") as
defined in Rule 405 of Regulation C of the 1933 Act Regulations has been
duly organized and is validly existing as a corporation or partnership, as
the case may be, in good standing under the laws of the jurisdiction of its
organization, has power and authority as a corporation or partnership, as
the case may be, to own, lease and operate its properties and conduct its
business as described in the Prospectus and is duly qualified as a foreign
corporation or partnership, as the case may be, to transact business and is
in good standing in each jurisdiction in which such qualification is
required, whether by reason of the ownership or leasing of property or the
conduct of business, except where the failure to so qualify would not have
a material adverse effect on the condition, financial or otherwise, or the
earnings, business affairs or business prospects of the Company and its
subsidiaries considered as one enterprise; all of the issued and
outstanding capital stock of each such corporate subsidiary has been duly
authorized and validly issued, is fully paid and non-assessable and, except
for directors' qualifying shares, is owned by the Company, directly or
5
<PAGE>
through subsidiaries, free and clear of any security interest, mortgage,
pledge, lien, encumbrance, claim or equity; and all of the issued and
outstanding partnership interests of each such subsidiary which is a
partnership have been duly authorized (if applicable) and validly issued
and are fully paid and non-assessable and (except for other partnership
interests described in the Prospectus) are owned by the Company, directly
or through corporate subsidiaries, free and clear of any security interest,
mortgage, pledge, lien, encumbrance, claim or equity.
(viii) REIT Status. The Company has at all times operated in such
-----------
manner as to qualify as a "real estate investment trust" under the Internal
Revenue Code of 1986, as amended (the "Code"), and intends to continue to
operate in such manner.
(ix) Capitalization. The authorized capital stock of the Company is
--------------
as set forth in the Prospectus under "Capitalization" (except for
subsequent issuances, if any, pursuant to reservations, agreements or
employee benefit plans referred to in the Prospectus); the shares of issued
Common Stock have been duly authorized and validly issued and are fully
paid and non-assessable; the Company has the requisite corporate power and
authority to execute and deliver this Agreement and to perform its
obligations hereunder and the Securities have been duly authorized for
issuance and sale to the Underwriters pursuant to this Agreement and, when
issued and delivered by the Company pursuant to this Agreement against
payment of the consideration set forth herein, will be validly issued and
fully paid and non-assessable; the Common Stock, the Preferred Stock and
the Series B Preferred Stock conform to all statements relating thereto
contained in the Prospectus and such descriptions conform to the rights set
forth in the instruments defining the same; the issuance of the Securities
is not subject to preemptive rights or similar rights; and, after giving
effect to the sale of the Securities and the sale of any other of the
Registered Securities to be issued prior to the delivery of the Securities,
the aggregate amount of Securities which have been issued and sold by the
Company will not exceed the aggregate amount of theretofore unsold
Registered Securities.
(x) Absence of Defaults and Conflicts. Neither the Company nor any
---------------------------------
of its subsidiaries is in violation of its charter or bylaws or in material
default in the performance or observance of any obligation, agreement,
covenant or condition contained in any contract, indenture, mortgage, loan
agreement, note, lease or other instrument to which the Company or any of
its subsidiaries is a party or by which it or any of them or their
properties may be bound or to which any of the property or assets of the
Company or any of its subsidiaries is subject and in which the violation or
default might result in a material adverse change in the condition,
financial or otherwise, or in the earnings, business affairs or business
prospects of the Company and its subsidiaries considered as one enterprise;
and the execution, delivery and performance of this Agreement and the
consummation of the transactions contemplated herein and compliance by the
Company with its obligations hereunder have been duly authorized by all
necessary corporate action and will not conflict with or constitute a
breach of, or default under, or result in the creation or imposition of any
lien, charge or encumbrance upon any property or assets of the Company or
any of its subsidiaries pursuant to any contract, indenture, mortgage,
6
<PAGE>
loan agreement, note, lease or other instrument to which the Company or any
of its subsidiaries is a party or by which it or any of them may be bound,
or to which any of the property or assets of the Company or any of its
subsidiaries is subject, nor will such action result in any violation of
the provisions of the charter or bylaws of the Company or any law,
administrative regulation or administrative or court order or decree.
(xi) Absence of Proceedings. There is no action, suit or proceeding
----------------------
before or by any court or governmental agency or body, domestic or foreign,
now pending, or, to the knowledge of the Company, threatened, against or
affecting the Company or any of its subsidiaries, which is required to be
disclosed in the Registration Statement (other than as disclosed therein),
or which might result in any material adverse change in the condition,
financial or otherwise, or in the earnings, business affairs or business
prospects of the Company and its subsidiaries considered as one enterprise,
or which might materially and adversely affect the properties or assets
thereof or which might materially and adversely affect the consummation of
this Agreement or any transaction contemplated hereby; all pending legal or
governmental proceedings to which the Company or any of its subsidiaries is
a party or of which any of their respective property or assets is the
subject which are not described in or incorporated by reference in the
Registration Statement, including ordinary routine litigation incidental to
the business, are, considered in the aggregate, not material; and there are
no contracts or documents of the Company or any of its subsidiaries which
are required to be filed or incorporated by reference as exhibits to, or
incorporated by reference in, the Registration Statement by the 1933 Act or
by the 1933 Act Regulations which have not been so filed.
(xii) Absence of Further Requirements. No authorization, approval,
-------------------------------
consent, order or decree of any court or governmental authority or agency
is required for the consummation by the Company of the transactions
contemplated by this Agreement or in connection with the offering, issuance
or sale of the Securities hereunder, except such as may be required under
the 1933 Act or the 1933 Act Regulations or state securities laws.
(xiii) Authorization of Purchase Agreement. This Agreement has been
-----------------------------------
duly authorized, executed and delivered by the Company and, upon execution
and delivery by the Underwriters, will be a valid and legally binding
agreement of the Company.
(xiv) Title to Property. The Company and its subsidiaries have good
-----------------
title to all real property or interests in real property owned by it or any
of them, in each case free and clear of all liens, encumbrances and defects
except such as are stated in or included in documents incorporated or
deemed to be incorporated by reference in the Prospectus or such as would
not materially adversely affect the condition, financial or otherwise, or
the earnings, business affairs or business prospects of the Company and its
subsidiaries considered as one enterprise; the Company and its subsidiaries
have obtained satisfactory confirmations (consisting of policies of title
insurance or commitments or binders therefor or opinions of counsel based
upon the examination of abstracts) confirming, except as otherwise
described in the Prospectus, (A) that the Company and its subsidiaries have
the foregoing title to such real property and interests in real property,
7
<PAGE>
and (B) that the instruments securing the Company's and its subsidiaries'
real estate mortgage loans create valid liens upon the real properties
described in such instruments enjoying the priorities intended, subject
only to exceptions to title which have no material adverse effect on the
value of such real properties and interests in relation to the Company and
its subsidiaries considered as one enterprise; and no material real
property and buildings are held under lease by the Company (other than
long-term ground leases).
(xv) Investment Company Act. The Company is not required to be
----------------------
registered under the Investment Company Act of 1940, as amended (the "1940
Act").
(xvi) Rating of the Securities. The Securities are currently rated
------------------------
"baa2" by Moody's Investor's Service, Inc., "BBB" by Standard & Poor's
Ratings Group and "BBB+" by Duff & Phelps Credit Rating Co.
(b) Any certificate signed by any officer of the Company and delivered to
the Underwriters or to counsel for the Underwriters shall be deemed a
representation and warranty by the Company to each Underwriter as to the matters
covered thereby.
Section 2. Sale and Delivery to Underwriters; Closing.
------------------------------------------
(a) On the basis of the representations and warranties herein contained and
subject to the terms and conditions herein set forth, the Company agrees to sell
to each Underwriter, severally and not jointly, and each Underwriter, severally
and not jointly, agrees to purchase from the Company, at $24.2125 per share, the
number of Initial Securities set forth in Schedule A hereto opposite the name of
such Underwriter, plus any additional number of Securities which such
Underwriter may become obligated to purchase pursuant to the provisions of
Section 10 hereof.
(b) In addition, on the basis of the representations and warranties herein
contained and subject to the terms and conditions herein set forth, the Company
hereby grants an option to the Underwriters, severally and not jointly, to
purchase up to an additional 750,000 shares of Series B Preferred Stock at the
price per share set forth in paragraph (a) above. The option hereby granted
will expire 30 days after the Representation Date, and may be exercised in whole
or in part from time to time only for the purpose of covering over-allotments
which may be made in connection with the offering and distribution of the
Initial Securities upon notice by the Underwriters to the Company setting forth
the number of Option Securities as to which the Underwriters are then exercising
the option and the time, date and place of payment and delivery for such Option
Securities. Any such time and date of delivery (a "Date of Delivery") shall be
determined by the Underwriters, but shall not be later than seven full business
days after the exercise of said option, nor in any event prior to Closing Time,
as hereinafter defined, unless otherwise agreed upon by the Underwriters and the
Company. If the option is exercised as to all or any portion of the Option
Securities, each of the Underwriters, acting severally and not jointly, will
purchase that proportion of the total number of Option Securities then being
purchased which the number of Initial Securities set forth in Schedule A
opposite the name of such Underwriter bears to the total number of Initial
Securities, subject in each case to such
8
<PAGE>
adjustments as the Underwriters in their discretion shall make to eliminate any
sales or purchases of fractional Securities.
(c) Payment of the purchase price for, and delivery of certificates for,
the Initial Securities shall be made at the office of Latham & Watkins, 633 West
Fifth Street, Suite 4000, Los Angeles, California 90071-2007, or at such other
place as shall be agreed upon by the Underwriters and the Company, at 7:00 A.M.,
Los Angeles time, on September 4, 1998 (unless postponed in accordance with the
provisions of Section 10 hereof), or such other time not later than ten business
days after such date as shall be agreed upon by the Underwriters and the Company
(such time and date of payment and delivery being herein called "Closing Time").
In addition, in the event that any or all of the Option Securities are purchased
by the Underwriters, payment of the purchase price for and delivery of
certificates for such Option Securities shall be made at the above-mentioned
office of Latham & Watkins, or at such other place as shall be mutually agreed
upon by the Underwriters and the Company, on each Date of Delivery as specified
in the notice from the Underwriters to the Company. Payment shall be made to
the Company by wire transfer of immediately available funds to a bank account
designated by the Company against delivery to the Underwriters of certificates
for the Securities to be purchased by the Underwriters. Certificates for the
Initial Securities and the Option Securities shall be in such denominations and
registered in such names as the Underwriters may request in writing at least one
business day before Closing Time or the relevant Date of Delivery, as the case
may be. It is understood that each Underwriter other than Merrill Lynch has
authorized Merrill Lynch, for its account, to accept delivery of, receipt for,
and make payment of the purchase price for, the Securities which it has agreed
to purchase. Merrill Lynch, individually and not as representative of the
Underwriters, may (but shall not be obligated to) make payment to the Company on
behalf of any Underwriter or Underwriters for the Securities to be purchased by
such Underwriter or Underwriters, but such payment shall not relieve such
Underwriter or Underwriters from its obligations hereunder. The certificates
for the Initial Securities and the Option Securities, if any, will be made
available for examination and packaging by the Underwriters not later than 10:00
A.M. on the last business day prior to Closing Time or the relevant Date of
Delivery, as the case may be in New York, New York.
Section 3. Covenants of the Company. The Company covenants with each
------------------------
Underwriter as follows:
(a) Compliance with Securities Regulations and Commission Requests.
--------------------------------------------------------------
The Company will notify the Underwriters immediately, and confirm the
notice in writing, (i) of the effectiveness of any post-effective amendment
to the Registration Statement, (ii) of the mailing or the delivery to the
Commission for filing of the Prospectus or any amendment to the
Registration Statement or amendment or supplement to the Prospectus or any
document to be filed pursuant to the 1934 Act during any period when the
Prospectus is required to be delivered under the 1933 Act, (iii) of the
receipt of any comments or inquiries from the Commission relating to the
Registration Statement or Prospectus, (iv) of any request by the Commission
for any amendment to the Registration Statement or any amendment or
supplement to the Prospectus or for additional
9
<PAGE>
information, (v) of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement or the
initiation of any proceeding for that purpose, and (vi) of the issuance by
any state securities commission or other regulatory authority of any order
suspending the qualification or the exemption from qualification of the
Securities under state securities or Blue Sky laws or the initiation of any
proceedings for that purpose. The Company will make every reasonable effort
to prevent the issuance by the Commission of any stop order and, if any
such stop order is issued, to obtain the lifting thereof at the earliest
possible moment. The Company will provide the Underwriters with copies of
the form of Prospectus, in such number as the Underwriters may reasonably
request, and file or transmit for filing with the Commission such
Prospectus in accordance with Rule 424(b) of the 1933 Act Regulations by
the close of business in New York on the second business day immediately
succeeding the date hereof.
(b) Filing of Amendments. The Company will give the Underwriters
--------------------
notice of its intention to file or prepare any amendment to the
Registration Statement (including any filing under Rule 462(b)) or any
amendment or supplement to the Prospectus (including any revised prospectus
which the Company proposes for use by the Underwriters in connection with
the offering of the Securities that differs from the prospectus filed with
the Commission pursuant to Rule 424(b) of the 1933 Act Regulations, whether
or not such revised prospectus is required to be filed pursuant to Rule
424(b) of the 1933 Act Regulations or any abbreviated term sheet prepared
in reliance on Rule 434 of the 1933 Act Regulations), will furnish the
Underwriters with copies of any such amendment or supplement a reasonable
amount of time prior to such proposed filing or use, as the case may be,
and will not file any such amendment or supplement or use any such
prospectus to which the Underwriters or counsel for the Underwriters shall
reasonably object.
(c) Delivery of Registration Statements. The Company will deliver to
-----------------------------------
the Underwriters as many signed copies of the Registration Statement as
originally filed and of each amendment thereto (including exhibits filed
therewith and documents incorporated or deemed to be incorporated by
reference therein) as the Underwriters may reasonably request and will also
deliver to the Underwriters as many conformed copies of the Registration
Statement as originally filed and of each amendment thereto (including
documents incorporated or deemed to be incorporated by reference therein
but without exhibits filed therewith) as the Underwriters may reasonably
request.
(d) Delivery of Prospectuses. The Company will furnish to the
------------------------
Underwriters, from time to time during the period when the Prospectus is
required to be delivered under the 1933 Act or the 1934 Act, such number of
copies of the Prospectus (as amended or supplemented) the Underwriters may
reasonably request for the purposes contemplated by the 1933 Act or the
1934 Act or the respective applicable rules and regulations of the
Commission thereunder.
(e) Continued Compliance with Securities Laws. If any event shall
-----------------------------------------
occur as a result of which it is necessary, in the opinion of counsel for
the Underwriters or counsel
10
<PAGE>
for the Company, to amend or supplement the Prospectus in order to make the
Prospectus not misleading in the light of the circumstances existing at the
time it is delivered to a purchaser, the Company will forthwith amend or
supplement the Prospectus (in form and substance satisfactory to counsel
for the Underwriters) so that, as so amended or supplemented, the
Prospectus will not contain an untrue statement of a material fact or omit
to state a material fact necessary in order to make the statements therein,
in the light of the circumstances existing at the time it is delivered to a
purchaser, not misleading, and the Company will furnish to the Underwriters
a reasonable number of copies of such amendment or supplement.
(f) Blue Sky Qualifications. The Company will endeavor, in
-----------------------
cooperation with the Underwriters, to qualify the Securities for offering
and sale under the applicable securities laws of such states and other
jurisdictions of the United States as the Underwriters may designate;
provided, however, that the Company shall not be obligated to file any
general consent to service of process or to qualify as a foreign
corporation in any jurisdiction in which it is not so qualified. In each
jurisdiction in which the Securities shall have been so qualified, the
Company will file such statements and reports as may be required by laws of
such jurisdiction to continue such qualification in effect for as long as
may be required for the distribution of the Securities.
(g) Earnings Statement. The Company will make generally available to
------------------
its security holders as soon as practicable, but not later than 60 days
after the close of the period covered thereby, an earnings statement (in
form complying with the provisions of Rule 158 of the 1933 Act Regulations)
covering the twelve month period beginning not later than the first day of
the Company's fiscal quarter next following the "effective date" (as
defined in said Rule 158) of the Registration Statement.
(h) Use of Proceeds. The Company will use the net proceeds received
---------------
by it from the sale of the Securities in the manner to be specified in the
Prospectus Supplement under "Use of Proceeds."
(i) Preparation of Prospectus Supplement. Immediately following the
------------------------------------
execution of this Agreement, the Company will prepare a prospectus
supplement, dated the date hereof (the "Prospectus Supplement"), containing
the terms of the Securities, the plan of distribution thereof and such
other information as may be required by the 1933 Act or the 1933 Act
Regulations or as the Underwriters and the Company deem appropriate, and
will file or transmit for filing with the Commission in accordance with
Rule 424(b) of the 1933 Act Regulations copies of the Prospectus (including
such Prospectus Supplement).
(j) Reporting Requirements. The Company, during the period when the
----------------------
Prospectus is required to be delivered under the 1933 Act or the 1934 Act,
will file promptly all documents required to be filed with the Commission
pursuant to Section 13, 14 or 15 of the 1934 Act within the time periods
required by the 1934 Act and the 1934 Act Regulations.
11
<PAGE>
(k) Restriction on Sale of Securities. During the period from the
---------------------------------
date of this Agreement through the Closing Time, the Company will not,
without the prior written consent of Merrill Lynch, directly or indirectly,
issue, sell, offer or contract to sell, grant any option for the sale of,
or otherwise transfer or dispose of, any Preferred Stock of the Company.
Section 4. Payment of Expenses. The Company will pay all expenses incident
-------------------
to the performance of its obligations under this Agreement, including (i) the
printing and filing of the Registration Statement as originally filed and of
each amendment thereto, (ii) the preparation, issuance and delivery of the
certificates for the Securities to the Underwriters, (iii) the fees and
disbursements of the Company's counsel and accountants, (iv) the qualification
of the Securities under securities laws in accordance with the provisions of
Section 3(f) hereof, including filing fees and the reasonable fee and
disbursements of counsel for the Underwriters in connection therewith and in
connection with the preparation of a Supplemental Blue Sky Survey, (v) the
printing and delivery to the Underwriters in quantities as hereinabove stated of
copies of the Registration Statement as originally filed and of each amendment
thereto, of each preliminary prospectus and preliminary prospectus supplement
and of the Prospectus and Prospectus Supplement and any amendments or
supplements thereto, including any abbreviated term sheet delivered by the
Company pursuant to Rule 434 of the 1933 Act Regulations, (vi) the printing and
delivery to the Underwriters of copies of the Supplemental Blue Sky Survey and
(vii) the fees and expenses incurred in connection with the listing of the
Securities on the New York Stock Exchange.
If this Agreement is cancelled or terminated by the Underwriters in
accordance with the provisions of Section 5 or Section 9(a)(i) hereof, the
Company shall reimburse the Underwriters for all of their out-of-pocket
expenses, including the reasonable fee and disbursements of counsel for the
Underwriters.
Section 5. Conditions of Underwriters' Obligations. The obligations of the
---------------------------------------
Underwriters hereunder are subject to the accuracy of the representations and
warranties of the Company herein contained, to the performance by the Company of
its obligations hereunder, and to the following further conditions:
(a) Effectiveness of Registration Statement. At Closing Time no stop
---------------------------------------
order suspending the effectiveness of the Registration Statement shall have
been issued under the 1933 Act or proceedings therefor initiated or
threatened by the Commission. The Prospectus (including the Prospectus
Supplement referred to in Section 3(i) hereof) shall have been filed or
transmitted for filing with the Commission pursuant to Rule 424(b) of the
1933 Act Regulations within the prescribed time period, and prior to
Closing Time the Company shall have provided evidence satisfactory to the
Underwriters of such timely filing or transmittal.
(b) Opinions. At Closing Time the Underwriters shall have received:
--------
12
<PAGE>
(1) The favorable opinion, dated as of Closing Time, of Latham &
Watkins, special counsel for the Company, as set forth in Exhibit A
hereto.
(2) The favorable opinion, dated as of Closing Time, of Latham &
Watkins, special counsel for the Company, in form and scope
satisfactory to counsel for the Underwriters and subject to customary
assumptions, limitations and exceptions acceptable to counsel for the
Underwriters, to the effect that:
(i) the Company was organized in conformity with the
requirements for qualification as a real estate investment trust
under the Code commencing with its taxable year ending December
31, 1985, and its proposed method of operation will enable it to
meet the requirements for qualification and taxation as a real
estate investment trust under the Code; and
(ii) the information in the Prospectus under the captions
"Certain Federal Income Tax Considerations to the Company," and
"Certain Federal Income Tax Considerations to Holders of Series B
Preferred Stock," insofar as such statements constitute matters
of law, summaries of legal matters, documents or proceedings, or
legal conclusions, has been reviewed by them and is accurate in
all material respects.
(3) The favorable opinion, dated as of Closing Time, of Ballard
Spahr Andrews & Ingersoll, LLP, Maryland counsel for the Company, in
form and scope satisfactory to counsel for the Underwriters, to the
effect that:
(i) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the
State of Maryland.
(ii) The Company has the corporate power and authority to
own, lease and operate its properties and to conduct its business
as described in the Prospectus.
(iii) The authorized capital stock of the Company is as set
forth in the Prospectus under "Capitalization."
(iv) The Securities have been duly authorized for issuance
and sale to the Underwriters pursuant to this Agreement and, when
issued and delivered by the Company pursuant to this Agreement
against payment of the consideration set forth herein, will be
validly issued and fully paid and non-assessable. The issuance
of such Securities is not subject to preemptive rights under the
charter or bylaws of the Company or the Maryland General
Corporation Law.
13
<PAGE>
(v) Texas HCP, Inc. has been duly incorporated and is
validly existing as a corporation in good standing under the laws
of the State of Maryland and has the corporate power and
authority to own, lease and operate its properties and to conduct
its business as described in the Prospectus. All of the issued
and outstanding shares of capital stock of such subsidiary has
been duly authorized and validly issued, is fully paid and non-
assessable and is owned by the Company, directly or through
subsidiaries, free and clear of any security interest, mortgage,
pledge, lien, or claim.
(vi) The execution and delivery of this Agreement has been
duly and validly authorized by all necessary corporate action on
the part of the Company under its charter and bylaws and the
Maryland General Corporation Law. This Agreement has been duly
executed and delivered by the Company.
(vii) The Preferred Stock and the Series B Preferred Stock
conform to the descriptions thereof contained in the Prospectus
and the form of certificate used to evidence the Securities is in
due and proper form.
(viii) The issuance and sale of the Securities by the
Company and the compliance by the Company with the provisions of
this Agreement and the consummation of the transactions
contemplated hereby, will not result in any violation of the
provisions of the charter or bylaws of the Company.
(ix) No authorization, approval, consent, decree or order
of any court or governmental authority or agency is required
under the Maryland General Corporation Law for the consummation
by the Company of the transactions contemplated by this Agreement
or in connection with the sale of the Securities hereunder,
except such as may have been obtained or rendered, as the case
may be.
In rendering its opinion, Ballard Spahr Andrews & Ingersoll, LLP
shall state that each of Brown & Wood llp, in rendering its opinion
pursuant to Section 5(b)(5), and Latham & Watkins, in rendering its
opinion pursuant to Section 5(b)(1), may rely upon such opinion as to
matters arising under the laws of the State of Maryland.
(4) The favorable opinion, dated as of Closing Time, of Edward J.
Henning, General Counsel of the Company, in form and scope
satisfactory to counsel for the Underwriters, to the effect that:
(i) To the best of such counsel's knowledge and
information, the Company is duly qualified as a foreign
corporation to transact business and is in good standing in each
jurisdiction in which its ownership or lease
14
<PAGE>
of substantial properties or the conduct of its business requires
such qualification, except where the failure to so qualify would
not have a material adverse effect on the condition, financial or
otherwise, or the earnings, business affairs or business
prospects of the Company and its subsidiaries considered as one
enterprise.
(ii) To the best of such counsel's knowledge and
information, each Significant Subsidiary of the Company is duly
qualified as a foreign corporation to transact business and is in
good standing in each jurisdiction in which its ownership or
lease of substantial properties or the conduct of its business
requires such qualification, except where the failure to so
qualify and be in good standing would not have a material adverse
effect on the condition, financial or otherwise, or the earnings,
business affairs or business prospects of the Company and its
subsidiaries considered as one enterprise.
(iii) To the best of such counsel's knowledge and
information, no material default exists in the due performance or
observance by the Company or any of its subsidiaries of any
obligation, agreement, covenant or condition contained in any
contract, indenture, mortgage, loan agreement, note, lease or
other instrument described or referred to in the Registration
Statement or filed as an exhibit thereto or incorporated by
reference therein which would have a material adverse effect on
the condition, financial or otherwise, or in the earnings,
business affairs or business prospects of the Company and its
subsidiaries considered as one enterprise.
(iv) To the best of such counsel's knowledge and
information, there are no contracts, indentures, mortgages, loan
agreements, notes, leases or other instruments or documents
required to be described or referred to in the Registration
Statement or to be filed as exhibits thereto other than those
described or referred to therein or filed or incorporated by
reference as exhibits thereto and the descriptions thereof or
references thereto are correct.
(v) The authorized, issued and outstanding capital stock
of the Company is as set forth in the Prospectus under
"Capitalization" (except for subsequent issuances, if any,
pursuant to reservations, agreements, dividend reinvestment plans
or employee or director stock plans referred to in the
Prospectus), the shares of Preferred Stock (including the Series
B Preferred Stock) have been duly authorized, and the shares of
issued and outstanding Common Stock have been duly authorized and
validly issued and are fully paid and non-assessable.
15
<PAGE>
(vi) To the best of such counsel's knowledge, there are no
legal or governmental proceedings pending or threatened which are
required to be disclosed in the Prospectus.
(vii) The issue and sale of the Securities and the
compliance by the Company with the provisions of this Agreement
and the consummation of the transactions contemplated herein will
not, to the best of such counsel's knowledge, result in any
material violation of any order applicable to the Company of any
court or governmental agency or body having jurisdiction over the
Company or any of its subsidiaries or any of their properties.
(5) The favorable opinion, dated as of Closing Time, of Brown &
Wood llp, counsel for the Underwriters, with respect to the matters
set forth in paragraph (ii) of Exhibit A hereto and in subparagraphs
(i), (iv), (vi) and (vii) of subsection (b)(3) of this Section. In
rendering such opinion, Brown & Wood llp may rely upon the opinion of
Ballard Spahr Andrews & Ingersoll, LLP,rendered pursuant to Section
5(b)(4), as to matters arising under the laws of the State of
Maryland.
(6) In giving their opinions required by subsections (b)(1) and
(b)(5), respectively, of this Section, Latham & Watkins and Brown &
Wood llp shall each additionally state that nothing has come to their
attention that would cause them to believe that the Registration
Statement, at the time it became effective, contained an untrue
statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading or that the Prospectus, at the Representation
Date (unless the term "Prospectus" refers to a prospectus which has
been provided to the Underwriters by the Company for use in connection
with the offering of the Securities which differs from the Prospectus
on file at the Commission at the Representation Date, in which case at
the time it is first provided to the Underwriters for such use) or at
Closing Time, included or includes an untrue statement of a material
fact or omitted or omits to state a material fact necessary in order
to make the statements therein, in the light of the circumstances
under which they were made, not misleading; it being understood that
such counsel shall express no opinion with respect to the financial
statements, schedules and other financial data in the Registration
Statement or the Prospectus. In giving their opinions, Latham &
Watkins and Brown & Wood llp may rely, to the extent recited therein,
(A) as to all matters of fact, upon certificates and written
statements of officers of the Company and (B) as to the qualification
and good standing of the Company and each Significant Subsidiary to do
business in any state or jurisdiction, upon certificates of
appropriate government officials.
(c) Officers' Certificate. At Closing Time there shall not have been,
---------------------
since the date hereof or since the respective dates as of which information
is given in the
16
<PAGE>
Registration Statement and the Prospectus, any material adverse change in
the condition, financial or otherwise, or in the earnings, business affairs
or business prospects of the Company and its subsidiaries considered as one
enterprise, whether or not arising in the ordinary course of business, and
the Underwriters shall have received a certificate of the President or a
Vice President of the Company and the chief financial or chief accounting
officer of the Company, dated as of Closing Time, to the effect that (i)
there has been no such material adverse change, (ii) the representations
and warranties in Section 1 hereof are true and correct with the same force
and effect as though expressly made at and as of Closing Time, (iii) the
Company has performed or complied with all agreements and satisfied all
conditions on its part to be performed or satisfied at or prior to Closing
Time, and (iv) no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for that purpose
have been initiated or, to the best knowledge and information of such
officer, threatened by the Commission. As used in this Section 5(c), the
term "Prospectus" means the Prospectus in the form first used to confirm
sales of the Securities.
(d) Accountant's Comfort Letter. At the time of execution of this
---------------------------
Agreement, the Underwriters shall have received from Arthur Andersen llp a
letter, dated such date, in form and substance satisfactory to the
Underwriters, containing statements and information of the type ordinarily
included in accountants "comfort letters" to underwriters with respect to
financial statements and financial information included and incorporated by
reference in the Registration Statement and the Prospectus (including,
without limitation, the pro forma financial statements, if any) and
substantially in the same form as the draft letter previously delivered to
and approved by the Underwriters.
(e) Bring-down Comfort Letter. At Closing Time the Underwriters shall
-------------------------
have received from Arthur Andersen llp a letter, dated as of Closing Time,
to the effect that they reaffirm the statements made in the letter
furnished pursuant to subsection (d) of this Section, except that the
specified date referred to therein shall be a date not more than three
business days prior to Closing Time.
(f) Listing. At Closing Time the Securities shall have been duly
-------
listed, subject to notice of issuance, on the New York Stock Exchange.
(g) Maintenance of Rating. At Closing Time, the Securities shall be
---------------------
rated at least "baa2" by Moody's Investors Service Inc., "BBB" by Standard
& Poor's Ratings Group, a division of McGraw-Hill, Inc. and "BBB+" by Duff
& Phelps Credit Rating Co., and the Company shall have delivered to the
Representatives a letter dated the Closing Time, from each such rating
agency, or other evidence satisfactory to the Representatives, confirming
that the Securities have such ratings; and since the date of this
Agreement, there shall not have occurred a downgrading in the rating
assigned to the Securities or any of the Company's other securities by any
"nationally recognized statistical rating agency", as that term is defined
by the Commission for purposes of Rule 436(g)(2) under the 1933 Act, and no
such organization shall have publicly announced that it has placed
17
<PAGE>
the Securities or any of the Company's other securities on what is commonly
termed a "watch list" for possible downgrading.
(h) Additional Documents. At Closing Time and each Date of Delivery,
--------------------
if any, counsel for the Underwriters shall have been furnished with such
documents and opinions as they may reasonably require for the purpose of
enabling them to pass upon the issuance and sale of the Securities as
herein contemplated and related proceedings, or in order to evidence the
accuracy and completeness of any of the representations and warranties, or
the fulfillment of any of the conditions, herein contained; and all
proceedings taken by the Company in connection with the issuance and sale
of the Securities as herein contemplated shall be satisfactory in form and
substance to the Underwriters and counsel for the Underwriters.
(i) Over-allotment Option. In the event the Underwriters exercise
---------------------
their option provided in Section 2 hereof to purchase all or any portion of
the Option Securities, the representations and warranties of the Company
contained herein and the statements in any certificates furnished by the
Company hereunder shall be true and correct as of each Date of Delivery,
and subject to the following further conditions:
(1) The Underwriters shall have received:
(i) The favorable opinion of Latham & Watkins, special
counsel for the Company, in form and substance satisfactory to
counsel for the Underwriters, dated such Date of Delivery,
relating to the Option Securities and otherwise to the same
effect as the opinion required by Sections 5(b)(1) and 5(b)(6)
hereof.
(ii) The favorable opinion of Latham & Watkins, special
counsel for the Company, in form and substance satisfactory to
counsel for the Underwriters, dated such Date of Delivery,
reaffirming their opinion delivered at Closing Time pursuant to
Section 5(b)(2) hereof.
(iii) The favorable opinion of Ballard Spahr Andrews &
Ingersoll, LLP, Maryland counsel for the Company, in form and
substance satisfactory to counsel for the Underwriters, dated
such Date of Delivery, relating to the Option Securities and
otherwise to the same effect as the opinion required by Sections
5(b)(3) hereof.
(iv) The favorable opinion of Edward J. Henning, General
Counsel of the Company, in form and substance satisfactory to
counsel for the Underwriters, dated such Date of Delivery,
reaffirming his opinion delivered at Closing Time pursuant to
Section 5(b)(4) hereof.
(v) The favorable opinion of Brown & Wood llp, counsel for
the Underwriters, dated such Date of Delivery, relating to the
Option
18
<PAGE>
Securities and otherwise to the same effect as the opinion
required by Sections 5(b)(5) and 5(b)(6) hereof.
(vi) A certificate of the President or a Vice President of
the Company and the chief financial or chief accounting officer
of the Company, dated such Date of Delivery, confirming that the
certificate delivered at Closing Time pursuant to Section 5(c)
hereof remains true and correct as of such Date of Delivery.
(vii) A letter from Arthur Andersen llp, in form and
substance satisfactory to the Underwriters, dated such Date of
Delivery, substantially the same in scope and substance as the
letter furnished to the Underwriters pursuant to Section 5(e)
hereof except that the "specified date" in the letter furnished
pursuant to this subsection shall be a date not more than three
business days prior to such Date of Delivery.
(2) At each Date of Delivery, the Securities shall be rated at
least "baa2" by Moody's Investors Service Inc., "BBB" by Standard &
Poor's Ratings Group, a division of McGraw-Hill, Inc. and "BBB+" by
Duff & Phelps Credit Rating Co.; and since the date of this Agreement,
there shall not have occurred a downgrading in the rating assigned to
the Securities or any of the Company's other securities by any
"nationally recognized statistical rating agency", as that term is
defined by the Commission for purposes of Rule 436(g)(2) under the
1933 Act, and no such organization shall have publicly announced that
it has placed the Securities or any of the Company's other securities
on what is commonly termed a "watch list" for possible downgrading.
If any condition specified in this Section shall not have been fulfilled
when and as required to be fulfilled, this Agreement may be terminated by the
Underwriters by notifying the Company at any time at or prior to Closing Time,
and such termination shall be without liability of any party to any other party
except as provided in Section 4 hereof. Notwithstanding any such termination,
the provisions of Sections 1, 4, 6, 7 and 8 shall remain in effect.
Section 6. Indemnification.
---------------
(a) Indemnification of the Underwriters. The Company agrees to indemnify
-----------------------------------
and hold harmless each Underwriter and each person, if any, who controls any
Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of
the 1934 Act, as follows:
(i) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, arising out of any untrue statement or alleged
untrue statement of a material fact contained in the Registration Statement
(or any amendment thereto), or any omission or alleged omission therefrom
of a material fact required to be stated therein or necessary to make the
statements therein not misleading or arising out of any untrue statement or
alleged untrue statement of a material fact contained in any preliminary
prospectus, any
19
<PAGE>
preliminary prospectus supplement or the Prospectus (or any amendment or
supplement thereto) or the omission or alleged omission therefrom of a
material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading;
(ii) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, to the extent of the aggregate amount paid in
settlement of any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or of any claim
whatsoever based upon any such untrue statement or omission, or any such
alleged untrue statement or omission, if such settlement is effected with
the written consent of the Company; and
(iii) against any and all expense whatsoever, as incurred (including,
subject to Section 6(c) hereof, the fees and disbursements of counsel
chosen by Merrill Lynch), reasonably incurred in investigating, preparing
or defending against any litigation, or any investigation or proceeding by
any governmental agency or body, commenced or threatened, or any claim
whatsoever based upon any such untrue statement or omission, or any such
alleged untrue statement or omission, to the extent that any such expense
is not paid under (i) or (ii) above;
provided, however, that (A) this indemnity agreement shall not apply to any
- -------- -------
loss, liability, claim, damage or expense to the extent arising out of any
untrue statement or omission or alleged untrue statement or omission made in
reliance upon and in conformity with written information furnished to the
Company by any Underwriter through Merrill Lynch expressly for use in the
Registration Statement (or any amendment thereto) or any preliminary prospectus,
preliminary prospectus supplement or the Prospectus (or any amendment or
supplement thereto), and (B) with respect to any untrue statement or omission or
alleged untrue statement or omission made in any preliminary prospectus or
preliminary prospectus supplement, this indemnity agreement shall not inure to
the benefit of any Underwriter (or to the benefit of any person controlling such
Underwriter within the meaning of Section 15 of the 1933 Act) to the extent that
any such loss, liability, claim, damage or expense of such Underwriter or any
person controlling such Underwriter results from the fact that such Underwriter
sold Securities to a person to whom it shall be established there was not sent
or given by such Underwriter or on such Underwriter's behalf at or prior to the
written confirmation of the sale of such Securities to such person, a copy of
the Prospectus (as then amended or supplemented), if required by law to have
been so delivered, and if the Prospectus (as so amended or supplemented) would
have cured the defect giving rise to such loss, liability, claim, damage or
expense and provided that the Company shall have met its obligation pursuant to
this Agreement to provide the Representatives with such Prospectus (as so
amended or supplemented).
(b) Indemnification of Company, Directors and Officers. Each Underwriter
--------------------------------------------------
severally agrees to indemnify and hold harmless the Company, its directors, each
of its officers who signed the Registration Statement, and each person, if any,
who controls the Company within the meaning of Section 15 of the 1933 Act
against any and all loss, liability, claim, damage and expense described in the
indemnity contained in subsection (a) of this Section, as incurred, but
20
<PAGE>
only with respect to untrue statements or omissions, or alleged untrue
statements or omissions, made in the Registration Statement (or any amendment
thereto) or any preliminary prospectus, preliminary prospectus supplement or the
Prospectus (or any amendment or supplement thereto) in reliance upon and in
conformity with information furnished to the Company by such Underwriter through
Merrill Lynch expressly for use in the Registration Statement (or any amendment
thereto) or such preliminary prospectus, preliminary prospectus supplement or
the Prospectus (or any amendment or supplement thereto).
(c) Actions Against Parties; Notification. Each indemnified party shall
-------------------------------------
give written notice as promptly as reasonably practicable to each indemnifying
party of any action commenced against it in respect of which indemnity may be
sought hereunder, but failure to so notify an indemnifying party shall not
relieve such indemnifying party from any liability hereunder to the extent it is
not materially prejudiced as a result thereof and in any event shall not relieve
it from any liability which it may have otherwise than on account of this
indemnity agreement. In the case of parties indemnified pursuant to Section
6(a) above, counsel to the indemnified parties shall be selected by the
Underwriter, and, in the case of parties indemnified pursuant to Section 6(b)
above, counsel to the indemnified parties shall be selected by the Company. An
indemnifying party may participate at its own expense in the defense of any such
action; provided, however, that counsel to the indemnifying party shall not
-------- -------
(except with the consent of the indemnified party) also be counsel to the
indemnified party. In no event shall the indemnifying parties be liable for
fees and expenses of more than one counsel (in addition to any local counsel)
separate from their own counsel for all indemnified parties in connection with
any one action or separate but similar or related actions in the same
jurisdiction arising out of the same general allegations or circumstances. No
indemnifying party shall, without the prior written consent of the indemnified
parties, settle or compromise or consent to the entry of any judgment with
respect to any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or any claim whatsoever in
respect of which indemnification or contribution could be sought under this
Section 6 or Section 7 hereof (whether or not the indemnified parties are actual
or potential parties thereto), unless such settlement, compromise or consent (i)
includes an unconditional release of each indemnified party from all liability
arising out of such litigation, investigation, proceeding or claim and (ii) does
not include a statement as to or an admission of fault, culpability or a failure
to act by or on behalf of any indemnified party.
(d) Settlement without Consent if Failure to Reimburse. If at any time an
--------------------------------------------------
indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel, such indemnifying party
agrees that it shall be liable for any settlement of the nature contemplated by
Section 6(a)(ii) effected without its written consent if (i) such settlement is
entered into more than 45 days after receipt by such indemnifying party of the
aforesaid request, (ii) such indemnifying party shall have received notice of
the terms of such settlement at least 30 days prior to such settlement being
entered into and (iii) such indemnifying party shall not have reimbursed such
indemnified party in accordance with such request prior to the date of such
settlement.
21
<PAGE>
(e) EDGAR. For purposes of this Section 6, all references to the
-----
Registration Statement, any preliminary prospectus, preliminary prospectus
supplement or the Prospectus, or any amendment or supplement to any of the
foregoing, shall be deemed to include, without limitation, any electronically
transmitted copies thereof filed with the Commission pursuant to EDGAR.
Section 7. Contribution. If the indemnification provided for in Section 6
------------
hereof is for any reason unavailable to or insufficient to hold harmless an
indemnified party in respect of any losses, liabilities, claims, damages or
expenses referred to therein, then each indemnifying party shall contribute to
the aggregate amount of such losses, liabilities, claims, damages and expenses
incurred by such indemnified party, as incurred, (i) in such proportion as is
appropriate to reflect the relative benefits received by the Company, on the one
hand, and the Underwriter, on the other hand, from the offering of the
Securities pursuant to this Agreement or (ii) if the allocation provided by
clause (i) 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 Company, on the one hand, and of the
Underwriter, on the other hand, in connection with the statements or omissions
which resulted in such losses, liabilities, claims, damages or expenses, as well
as any other relevant equitable considerations.
The relative benefits received by the Company, on the one hand, and the
Underwriter, on the other hand, in connection with the offering of the
Securities pursuant to this Agreement shall be deemed to be in the same
respective proportions as the total net proceeds from the offering of the
Securities pursuant to this Agreement (before deducting expenses) received by
the Company and the total underwriting discount received by the Underwriter, in
each case as set forth on the cover of the Prospectus (or, if Rule 434 is used,
the corresponding location on the Term Sheet) bear to the aggregate public
offering price of the Securities as set forth on such cover (or corresponding
location on the Term Sheet, as the case may be).
The relative fault of the Company, on the one hand, and the Underwriter, on
the other hand, shall be determined by reference to, among other things, whether
any such untrue or alleged untrue statement of a material fact or omission or
alleged omission to state a material fact relates to information supplied by the
Company or by the Underwriters and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission.
The Company and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this Section 7 were determined by pro rata
allocation or by any other method of allocation which does not take account of
the equitable considerations referred to above in this Section 7. The aggregate
amount of losses, liabilities, claims, damages and expenses incurred by an
indemnified party and referred to above in this Section 7 shall be deemed to
include any legal or other expenses reasonably incurred by such indemnified
party in investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever based upon any such untrue or alleged untrue
statement or omission or alleged omission.
22
<PAGE>
Notwithstanding the provisions of this Section 7, the Underwriters shall
not be required to contribute any amount in excess of the amount by which the
total price at which the Securities were offered exceeds the amount of any
damages which the Underwriters have otherwise been required to pay by reason of
any such 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 1933 Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.
For purposes of this Section 7, each person, if any, who controls any
Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of
the 1934 Act shall have the same rights to contribution as such Underwriter, and
each director of the Company, each officer of the Company who signed the
Registration Statement, and each person, if any, who controls the Company within
the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act shall
have the same rights to contribution as the Company.
Section 8. Representations, Warranties and Agreements to Survive Delivery.
--------------------------------------------------------------
All representations, warranties and agreements contained in this Agreement, or
contained in certificates of officers of the Company submitted pursuant hereto
or thereto, shall remain operative and in full force and effect, regardless of
any investigation made by or on behalf of the Underwriters or any controlling
person, or by or on behalf of the Company, and shall survive delivery of the
Securities to the Underwriters.
Section 9. Termination of Agreement.
------------------------
(a) The Underwriters may terminate this Agreement, by notice to the
Company, at any time at or prior to Closing Time (i) if there has been, since
the date of this Agreement or since the respective dates as of which information
is given in the Prospectus, any material adverse change in the condition,
financial or otherwise, or in the earnings, business affairs or business
prospects of the Company and its subsidiaries considered as one enterprise,
whether or not arising in the ordinary course of business, (ii) if there has
occurred any material adverse change in the financial markets in the United
States, any outbreak of hostilities or other calamity or crisis or change or
development involving a prospective change in national or international
political, financial or economic conditions, in each case the effect of which on
the financial markets of the United States is such as to make it, in the
judgement of the Underwriters, impracticable to market the Securities or enforce
contracts for the sale of the Securities, or (iii) if trading in the securities
of the Company has been suspended by the Commission, or if trading generally on
either the American Stock Exchange or the New York Stock Exchange or in the
NASDAQ National Market has been suspended, or minimum or maximum prices for
trading have been fixed, or maximum ranges for prices for securities have been
required, by either of said Exchanges or by order of the Commission, the NASD or
any other governmental authority, or if a banking moratorium has been declared
by either federal, New York, Maryland or California authorities.
23
<PAGE>
As used in this Section 9(a), the term "Prospectus" means the Prospectus in the
form first used to confirm sales of the Securities.
(b) If this Agreement is terminated pursuant to this Section, such
termination shall be without liability of any party to any other party except as
provided in Section 4 hereof. Notwithstanding any such termination, the
provisions of Sections 4, 6, 7 and 8 shall remain in effect.
Section 10. Default by One or More of the Underwriters. If any Underwriter
------------------------------------------
shall fail at Closing Time to purchase the Securities which it is obligated to
purchase hereunder (the "Defaulted Securities"), the Representative shall have
the right, but not the obligation, within 24 hours thereafter, to make
arrangements for one or more of the non-defaulting Underwriters, or any other
underwriters, to purchase all, but not less than all, of the Defaulted
Securities in such amounts as may be agreed upon and upon the terms herein set
forth; if, however, the Representative shall have not completed such
arrangements within such 24-hour period, then:
(a) if the number of Defaulted Securities does not exceed 10% of the
number of Securities to be purchased on such date, each of the non-
defaulting Underwriters shall be obligated, severally and not jointly, to
purchase the full amount thereof in the proportions that their respective
underwriting obligations hereunder bear to the underwriting obligations of
all non-defaulting Underwriters, or
(b) if the number of Defaulted Securities exceeds 10% of the number of
Securities to be purchased on such date, this Agreement or, with respect to
any Date of Delivery which occurs after the Closing Time, the obligation of
the Underwriters to purchase and of the Company to sell the Option
Securities to be purchased and sold on such Date of Delivery, shall
terminate without liability on the part of any non-defaulting Underwriter.
No action pursuant to this Section shall relieve any defaulting Underwriter
from liability in respect of its default.
In the event of any such default which does not result in a termination of
this Agreement, either the Non-Defaulting Underwriters or the Company shall have
the right to postpone Closing Time for a period not exceeding seven days in
order to effect any required changes in the Registration Statement or Prospectus
or in any other documents or arrangements.
Section 11. Notices. All notices and other communications hereunder shall
-------
be in writing and shall be deemed to have been duly given if mailed or
transmitted by any standard form of written telecommunication. Notices to the
Underwriters shall be directed to them at Merrill Lynch & Co., 10877 Wilshire
Boulevard, Suite 1900, Los Angeles, CA 90024, Attention: James F. Flaherty III,
Managing Director, and notices to the Company shall be directed to it at 4675
MacArthur Court, 9th Floor, Newport Beach, California 92660, Attention: Kenneth
B. Roath, President and Chief Executive Officer, with a copy to Pamela B. Kelly,
Esq. at Latham & Watkins, 633 West Fifth Street, Suite 4000, Los Angeles,
California 90071.
24
<PAGE>
Section 12. Parties. This Agreement shall inure to the benefit of and be
-------
binding upon the Underwriters and the Company and their respective successors.
Nothing expressed or mentioned in this Agreement is intended or shall be
construed to give any person, firm or corporation other than the Underwriters
and the Company and their respective successors and the controlling persons and
the officers and directors referred to in Sections 6 and 7 hereof and their
heirs and legal representatives any legal or equitable right, remedy or claim
under or in respect of this Agreement or any provision herein contained. This
Agreement and all conditions and provisions hereof are intended to be for the
sole and exclusive benefit of the Underwriters and the Company and their
respective successors, and said controlling persons and said officers and
directors and their heirs and legal representatives, and for the benefit of no
other person, firm or corporation. No purchaser of Securities from any
Underwriter shall be deemed to be a successor merely by reason of such purchase.
Section 13. Governing Law and Time. This Agreement shall be governed by
----------------------
and construed in accordance with the laws of the State of California applicable
to agreements made and to be performed in such State. Unless stated otherwise,
all specified times of day refer to New York City time.
25
<PAGE>
If the foregoing is in accordance with your understanding of our agreement,
please sign and return to the Company a counterpart hereof, whereupon this
instrument, along with all counterparts, will become a binding agreement between
the Underwriters and the Company in accordance with its terms.
Very truly yours,
HEALTH CARE PROPERTY INVESTORS, INC.
By: /s/ Edward J. Henning
-------------------------------------
Name: Edward J. Henning
Title: Senior Vice President
CONFIRMED AND ACCEPTED,
as of the date first above written:
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
MORGAN STANLEY & CO. INCORPORATED
PAINEWEBBER INCORPORATED
PRUDENTIAL SECURITIES INCORPORATED
SALOMON SMITH BARNEY INC.
As Representatives of the Underwriters
By: MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
By: /s/ Paul M. Meurer
-------------------------------------
Authorized Signatory
26
<PAGE>
SCHEDULE A
<TABLE>
<CAPTION>
Underwriters Number of
- --------------------------------------------- Securities
----------
<S> <C>
Merrill Lynch, Pierce, Fenner & Smith
Incorporated..................... 890,000
Morgan Stanley & Co. Incorporated............ 890,000
PaineWebber Incorporated..................... 890,000
Prudential Securities Incorporated........... 890,000
Salomon Smith Barney Inc..................... 890,000
BT Alex. Brown Incorporated.................. 50,000
CIBC Oppenheimer Corp........................ 50,000
A.G. Edwards & Sons Inc...................... 50,000
EVEREN Securities, Inc....................... 50,000
J.J.B. Hilliard, W.L. Lyons, Inc............. 50,000
Legg Mason Wood Walker, Incorporated......... 50,000
NationsBanc Montgomery Securities LLC........ 50,000
Piper Jaffray Inc............................ 50,000
Raymond James & Associates, Inc.............. 50,000
Tucker Anthony Incorporated.................. 50,000
Wheat First Securities, Inc.................. 50,000
---------
Total............................... 5,000,000
=========
</TABLE>
27
<PAGE>
EXHIBIT A
September 4, 1998
MERRILL LYNCH & CO.
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED
MORGAN STANLEY & CO. INCORPORATED
PAINEWEBBER INCORPORATED
PRUDENTIAL SECURITIES INCORPORATED
SALOMON SMITH BARNEY INC.
as Representative of the several Underwriters
c/o Merrill Lynch & Co.,
Merrill Lynch, Pierce, Fenner & Smith Incorporated
World Financial Center
North Tower, 10th Floor
New York, New York 10281-1209
Re: Health Care Property Investors, Inc.
8.70% Series B Cumulative Redeemable Preferred Stock
----------------------------------------------------
Ladies and Gentlemen:
We have acted as special counsel to Health Care Property Investors, Inc., a
Maryland corporation (the "Company"), in connection with the sale to you on the
date hereof by the Company, of ________ shares of the Company's 8.70% Series B
Cumulative Redeemable Preferred Stock (the "Series B Preferred Stock"), pursuant
to (i) a registration statement on Form S-3 under the 1933 Act, filed with the
Securities and Exchange Commission (the "Commission") on June 18, 1998 (File No.
333-57163), and as declared effective by the Commission on June 30, 1998, (ii) a
Prospectus dated August 27, 1998, including the documents incorporated or deemed
to be incorporated by reference therein (the "Base Prospectus"), as supplemented
by the Prospectus Supplement dated September 1, 1998 filed with the Commission
on September 2, 1998 pursuant to Rule 424(b) under the 1933 Act (the "Prospectus
Supplement," and together with the Base Prospectus, the "Prospectus") and (iii)
a purchase agreement dated September 1, 1998 between you, as representative of
the several underwriters named in Schedule A thereto, and the Company (the
"Purchase Agreement"). . shares of the Series B Preferred
1
<PAGE>
Stock are being purchased pursuant to Section 2(b) of the Purchase Agreement by
the several underwriters named in Schedule A thereto.
This opinion is being rendered to you pursuant to Section 5(b)(1) of the
Purchase Agreement among Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner &
Smith Incorporated, Morgan Stanley & Co. Incorporated, PaineWebber Incorporated,
Prudential Securities Incorporated, Salomon Smith Barney Inc., as representative
of the several underwriters named in Schedule A thereto, and the Company. All
capitalized terms used and not specifically defined herein shall have the
definitions ascribed to them in the Purchase Agreement.
As such counsel, we have examined such matters of fact and questions of law
as we have considered appropriate for purposes of rendering the opinions
expressed below. We have examined, among other things, the following:
(a) The Purchase Agreement; and
(b) (i) that certain indenture dated as of April 1, 1989 between the
Company and The Bank of New York, as Trustee, for debt securities; (ii) that
certain indenture dated as of September 1, 1993 between the Company and The Bank
of New York, as Trustee, for debt securities; (iii) that certain Fiscal Agency
Agreement dated as of November 8, 1993 between the Company and Chemical Bank, as
Fiscal Agent, for 6% Convertible Subordinated Notes due 2000; (iv) that certain
$50,000,000 Revolving Credit Agreement dated as of October 22, 1997 among the
Company, The Bank of New York, as agent, The Sumitomo Bank, Bank of Montreal,
Kredietbank N.V., Wells Fargo Bank, Bank of Hawaii and NationsBank of Texas,
N.A. and (v) that certain Revolving Credit Agreement dated as of October 22,
1997 among the Company, The Bank of New York, as agent, The Sumitomo Bank, Bank
of Montreal, Kredietbank N.V., Wells Fargo Bank, Bank of Hawaii and NationsBank
of Texas, N.A. (collectively, the "Material Agreements").
In our examination, we have assumed the genuineness of all signatures, the
authenticity of all documents submitted to us as originals and the conformity to
authentic original documents of all documents submitted to us as copies.
As to facts material to the opinions, statements and assumptions expressed
herein, we have, with your consent, relied exclusively upon oral or written
statements and representations of officers and other representations of the
Company and others. In addition, we have obtained and relied upon such
certificates and assurances from public officials as we have deemed necessary.
We are opining herein as to the effect on the subject transaction only of
the federal laws of the United States and the internal laws of the State of
California, and we express no opinion with respect to the applicability thereto,
or the effect thereon, of the laws of any other jurisdiction or as to any
matters of municipal law or the laws of any local agencies within any state. We
understand that various matters concerning the laws of the
2
<PAGE>
State of Maryland are addressed in an opinion of Ballard Spahr Andrews &
Ingersoll, LLP separately provided to you, and we express no opinion with
respect to those matters. In rendering the opinions set forth below, we have,
with your permission, assumed that the Company is duly incorporated and is
validly existing as a corporation in good standing under the laws of the State
of Maryland; that each of the Purchase Agreement and the Series B Preferred
Stock has been duly authorized, executed and delivered by the Company; and that
none of the issuance and sale of the Series B Preferred Stock by the Company, or
the performance and compliance by the Company with the provisions of the
Purchase Agreement, the Series B Preferred Stock, or the consummation of the
transactions contemplated thereby, will result in any violation of the
provisions of the charter or bylaws of the Company.
Our opinions set forth in paragraphs (iii) and (iv) below are based upon
our consideration of only those statutes, rules and regulations which, in our
experience, are normally applicable to the issuance and sale of preferred stock
Subject to the foregoing, and the other matters set forth herein, it is our
opinion that, as of the date hereof:
(i) The Registration Statement has been declared effective under the 1933
Act and, based solely on telephonic confirmation with the Commission, no stop
order suspending the effectiveness of the Registration Statement has been issued
under the 1933 Act and no proceedings therefor have been initiated or threatened
by the Commission.
(ii) The Registration Statement at the time it became effective and at the
date hereof, appeared on its face to comply as to form in all material respects
with the requirements for registration statements on Form S-3 under the 1933 Act
and the 1933 Act Regulations; it being understood that we express no opinion
with respect to documents incorporated by reference therein (except as set forth
in paragraph (v) below), the financial statements, schedules and other financial
data included or incorporated by reference in the Registration Statement. In
passing upon the compliance as to form of the Registration Statement, we have
assumed that the statements made and incorporated by reference therein are true,
correct and complete.
(iii) The issue and sale of the Series B Preferred Stock and the
compliance by the Company with the provisions of the Purchase Agreement and the
consummation of the transactions therein contemplated will not result in a
breach or violation of any material term or provision of, or constitute a
default under, the Material Agreements; nor will such action result in any
material violation of any statute, rule or regulation applicable to the Company
of any court or governmental agency or body having jurisdiction over the Company
or any of its subsidiaries or any of their properties (other than federal or
state securities law, which are specifically addressed elsewhere herein).
(iv) No approval, authorization, consent, order or decree of any Federal
or California court or governmental authority or agency is required for the
consummation by
3
<PAGE>
the Company of the transactions contemplated by the Purchase Agreement or in
connection with the sale of the Series B Preferred Stock thereunder, except such
as may have been obtained or rendered, as the case may be, or as may be required
under the 1933 Act or the 1933 Act Regulations or state securities laws
(including real estate syndication laws).
(v) Each document filed pursuant to the 1934 Act and incorporated or
deemed to be incorporated by reference in the Prospectus (other than the
financial statements, schedules and other financial data included or
incorporated by reference therein, as to which we express no opinion), at the
time it was filed with the Commission, appeared on its face to comply as to form
in all material respects with the requirements of the 1934 Act and the 1934 Act
Regulations. In passing upon compliance as to form of such documents, we have
assumed that the statements made therein are true, correct and complete.
(vi) The Company is not an "investment company" within the meaning of the
1940 Act.
In addition, we have participated in conferences with officers and other
representatives of the Company, representatives of the independent public
accountants for the Company, and your representatives, at which the contents of
the Registration Statement and the Prospectus and related matters were discussed
and, although we are not passing upon, and do not assume any responsibility for,
the accuracy, completeness or fairness of the statements contained or
incorporated by reference in the Registration Statement and the Prospectus and
have not made any independent check or verification thereof, during the course
of such participation, no facts came to our attention that caused us to believe
that the Registration Statement, at the time it became effective, contained an
untrue statement of a material fact or omitted to state a material fact required
to be stated therein or necessary to make the statements therein not misleading,
or that the Prospectus, as of its date or as of the date hereof, contained or
contains an untrue statement of a material fact or omitted or omits to state a
material fact required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading; it being understood that we express no belief with respect to the
financial statements, schedules and other financial data included or
incorporated by reference in the Registration Statement or the Prospectus.
This opinion is rendered only to you and is solely for your benefit in
connection with the transactions covered hereby. This opinion may not be relied
upon by you for any other purpose, or furnished to, quoted to or relied upon by
any other person, firm or corporation for any purpose, without our prior written
consent.
Very truly yours,
4
<PAGE>
EXHIBIT 1.3
PRESS RELEASE Contact: Kenneth B. Roath
949/221-0600
James G. Reynolds
HEALTH CARE PROPERTY INVESTORS, INC. COMPLETES $135 MILLION FIXED RATE PERPETUAL
PREFERRED STOCK OFFERING
NEWPORT BEACH, CALIFORNIA, September 9, 1998 -- Health Care Property Investors,
Inc. (NYSE/HCP) announced today that it has sold 5,385,000 shares of 8.7 percent
Series B Cumulative Redeemable Preferred Stock at $25 per share. The Series B
Preferred Stock, which may be called by the Company at par on or after September
30, 2003, has no stated maturity, will not be subject to any sinking fund or
mandatory redemption and will not be convertible into any other securities of
the Company. The Series B Preferred Stock has been rated Baa2/BBB/BBB+ by
Moody's Investors Service, Standard & Poor's and Duff and Phelps Credit Rating
Co., respectively. The Company has received approval from the New York Stock
Exchange (NYSE) to list the Series B Preferred Stock on the NYSE.
The net proceeds of the offering will be approximately $130 million. Proceeds of
the offering will be used to repay short-term bank debt and to fund future
acquisitions. Kenneth B. Roath, Chairman and Chief Executive Officer of the
Company, said, "We are very pleased by the exceptional demand for our preferred
stock in these very turbulent capital markets. The offering was received well
enough that we were able to increase the size while slightly decreasing the
dividend rate. We believe that this preferred stock is a good addition to the
permanent equity base of Health Care Property Investors and shows the excellent
reception for the Company's security offering under difficult market
conditions."
The Underwriters were Merrill Lynch & Co. (books), Morgan Stanley Dean Witter,
PaineWebber Incorporated, Prudential Securities Incorporated and Salomon Smith
Barney. The Underwriters have a 30-day option to purchase an additional 365,000
shares to cover over-allotments. A copy of the prospectus relating to the
offering may be obtained from Merrill Lynch & Co., 250 Vesey Street, New York,
New York, 10281.
Health Care Property Investors, Inc. is a self-administered equity-oriented real
estate investment trust that invests in health care related facilities,
including long-term care, acute care, rehabilitation, assisted living and
congregate care, physician group practice clinics, medical office buildings and
a psychiatric care center. The Company has invested directly or through joint
ventures in 292 properties in 41 states.
<PAGE>
EXHIBIT 4.1
HEALTH CARE PROPERTY INVESTORS, INC.
Officers' Certificate Pursuant to
Section 201 of the Indenture
August 27, 1998
James G. Reynolds and Edward J. Henning, do hereby certify that we are the
duly elected Executive Vice President and Chief Financial Officer, and Senior
Vice President, General Counsel and Corporate Secretary, respectively, of Health
Care Property Investors, Inc., a Maryland corporation (the "Company"), and do
hereby further certify as follows:
The undersigned, having read the indenture, dated as of September 1, 1993 (the
"Indenture"), between the Company and The Bank of New York, as trustee (the
"Trustee"), including Section 201 thereof, and the definitions in such Indenture
relating thereto and certain other corporate documents and records, and having
made such examination or investigation as each considers necessary to enable the
undersigned to express an informed opinion, certify that the forms of the
certificate for the Company's Medium-Term Notes, Series D (an authorized series
of Securities to be issued under the Indenture), as set forth on Exhibit A
hereto, were established on the date hereof by the undersigned pursuant to
authority delegated to them by resolutions of the Board of Directors of the
Company adopted on July 22, 1993 and July 1, 1998.
[SIGNATURE PAGE FOLLOWS]
<PAGE>
By: /s/ James G. Reynolds
-----------------------------------
James G. Reynolds
Executive Vice President and
Chief Financial Officer
By: /s/ Edward J. Henning
-----------------------------------
Edward J. Henning
Senior Vice President, General Counsel
and Corporate Secretary
<PAGE>
EXHIBIT 4.2
[FORM OF FLOATING RATE GLOBAL MEDIUM-TERM NOTE]
[The following legend is for inclusion only in Book-Entry Securities for
which The Depository Trust Company serves as Depositary -- Unless this
certificate is presented by an authorized representative of The Depository Trust
Company, a New York corporation ("DTC"), to the Company or its agent for
registration of transfer, exchange or payment, and any certificate issued is
registered in the name of Cede & Co. or in such other name as is requested by an
authorized representative of DTC and any payment is made to Cede & Co. or to
such other entity as is requested by an authorized representative of DTC, ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest
herein.]
[The following legend is for inclusion only in Book-Entry Securities -- UNLESS
AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN CERTIFICATED FORM,
THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A
NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR
ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A
SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY.]
REGISTERED PRINCIPAL AMOUNT
No. FLR____ CUSIP No. ___________ $_______________
HEALTH CARE PROPERTY INVESTORS, INC.
MEDIUM-TERM NOTE, SERIES D
(Floating Rate)
INTEREST RATE BASIS: ORIGINAL ISSUE DATE: STATED MATURITY
DATE:
If LIBOR (check one)
LIBOR Reuters [ ]
LIBOR Telerate [ ]
INDEX MATURITY: INITIAL INTEREST RATE: INTEREST PAYMENT
PERIOD:
REGULAR RECORD DATES:
SPREAD: INITIAL INTEREST RESET INTEREST PAYMENT
DATES: DATE:
SPREAD MULTIPLIER: INTEREST RATE RESET INTEREST RESET
DATES: PERIOD:
1
<PAGE>
MAXIMUM INTEREST MINIMUM INTEREST INITIAL REDEMPTION
RATE: RATE:
INITIAL REDEMPTION ANNUAL REDEMPTION OPTIONAL
REPAYMENT PERCENTAGE: PERCENTAGE
REDUCTION: DATE(S)
CALCULATION AGENT:
INTEREST CALCULATION DAY COUNT CONVENTION
[ ] Regular Floating Rate Note [ ] Actual/360 for the period
from to
[ ] Floating Rate/Fixed Rate
Fixed Rate Commencement Date: [ ] Actual/Actual to the period
Fixed Interest Rate: from to
[ ] Inverse Floating Rate Note
Fixed Interest Rate:
ADDENDUM ATTACHED: ORIGINAL ISSUE DISCOUNT:
[ ] Yes [ ] Yes
[ ] No [ ] No
Total Amount of OID:
Yield to Maturity:
Initial Accrual Period:
OTHER PROVISIONS:
2
<PAGE>
HEALTH CARE PROPERTY INVESTORS, INC., a Maryland corporation ("Issuer" or
the "Company," which terms include any successor corporation under the Indenture
hereinafter referred to), for value received, hereby promises to pay to
, or registered assigns, the Principal Amount specified above on the Stated
Maturity Date specified above (except to the extent redeemed or repaid prior to
the Stated Maturity Date), and to pay interest thereon, at a rate per annum
equal to the Initial Interest Rate specified above until the Initial Interest
Reset Date specified above and thereafter at a rate per annum determined in
accordance with the provisions hereof and any Addendum relating hereto,
depending upon the Interest Rate Basis or Bases, if any, and such other terms
specified above, until such Principal Amount is paid or duly made available for
payment. Reference herein to "this Note," "hereof," "herein" and comparable
terms shall include an Addendum hereto if an Addendum is specified above.
The Company will pay interest monthly, quarterly, semiannually, annually or
such other period as specified above under "Interest Payment Period," on each
Interest Payment Date specified above, commencing on the first Interest Payment
Date specified above next succeeding the Original Issue Date specified above,
and on the Stated Maturity Date or any Redemption Date or Optional Repayment
Date (the date of each such Stated Maturity Date, Redemption Date and Optional
Repayment Date and the date on which principal or an installment of principal is
due and payable by declaration of acceleration pursuant to the Indenture being
referred to hereinafter as a "Maturity" with respect to principal payable on
such date); provided, however, that if the Original Issue Date is between a
-------- -------
record date (as defined below) and the next succeeding Interest Payment Date,
interest payments will commence on the Interest Payment Date immediately
following the next succeeding record date; and provided, further, that if an
-------- -------
Interest Payment Date (other than an Interest Payment Date at Maturity) would
fall on a day that is not a Business Day (as defined below), such Interest
Payment Date shall be the following day that is a Business Day, except that in
the case the Interest Rate Basis is LIBOR, as indicated above, if such next
Business Day falls in the next calendar month, such Interest Payment Date shall
be the next preceding day that is a Business Day.
Except as provided above, interest payments will be made on the Interest
Payment Dates shown above. Unless otherwise specified above, the "record date"
shall be the date 15 calendar days (whether or not a Business Day) prior to the
applicable Interest Payment Date. Interest on this Note will accrue from and
including the Original Issue Date specified above, at the rates determined from
time to time as specified herein, until the principal hereof has been paid or
made available for payment. If the Maturity falls on a day which is not a
Business Day as defined below, the payment due on such Maturity will be paid on
the next succeeding Business Day with the same force and effect as if made on
such Maturity and no interest shall accrue with respect to such payment for the
period from and after such Maturity. The interest so payable and punctually
paid or duly provided for on any Interest Payment Date will as provided in the
Indenture be paid to the Person in whose name this Note is registered at the
close of business on the record date for such Interest Payment Date. Any such
interest which is payable, but not punctually paid or duly provided for on any
Interest Payment Date (herein called "Defaulted
3
<PAGE>
Interest"), shall forthwith cease to be payable to the registered Holder on such
record date, and may be paid to the Person in whose name this Note is registered
at the close of business on a Special Record Date (which shall be not more than
15 nor less than ten days prior to the date of payment of such Defaulted
Interest) established by notice given by mail by or on behalf of the Company to
the Holder of this Note not less than ten days preceding such Special Record
Date, all as more fully provided in the Indenture.
Payment of interest on this Note will be made at the office or agency of
the Company maintained by the Company for such purpose in the Borough of
Manhattan, The City of New York, in such coin or currency of the United States
of America as at the time of payment is legal tender for payment of public and
private debts: provided, however, that at the option of the Company, payment of
-------- -------
interest due other than at Maturity may be made by check mailed to the address
of the Person entitled thereto as such address shall appear in the registry
books of the Company; and provided, further, that the payment of the principal
-------- -------
of and interest on this Note on any Optional Repayment Date(s), if any,
indicated above shall be made upon satisfaction of the provisions herein; and
provided, further, that AT THE OPTION OF THE COMPANY, the Holder of Notes with
- -------- -------
an aggregate principal amount of $10,000,000 or more will be entitled to receive
payments of interest on this Note (other than at Maturity) by wire transfer of
immediately available funds if appropriate wire transfer instructions have been
received in writing by the Trustee (as defined below) not less than 15 days
prior to the applicable Interest Payment Date. Such wire instructions, upon
receipt by the Trustee, shall remain in effect until revoked by such Holder.
Payment of principal or premium, if any, at the Maturity of this Note will
be made in immediately available funds upon presentation of this Note at the
office or agency of the Company maintained by the Company for such purpose in
the Borough of Manhattan, The City of New York, or at such other place as the
Company may designate. Payment of interest due at Maturity will be made to the
person to whom payment of the principal of this Note shall be made.
Unless the certificate of authentication hereon has been executed by or on
behalf of the Trustee under the Indenture, by the manual signature of one of its
authorized signatories, this Note shall not be entitled to any benefit under the
Indenture or be valid or obligatory for any purpose. This Note is one of a duly
authorized series of Securities (hereinafter called the "Securities") of the
Company designated as its Medium-Term Notes, Series D (the "Notes"). The Notes
are issued and to be issued under an Indenture dated as of September 1, 1993
(herein called the "Indenture") between the Company and The Bank of New York, a
corporation incorporated under the laws of the State of New York, as trustee
(the "Trustee," which term includes any successor trustee with respect to the
Notes under the Indenture), to which Indenture and all indentures supplemental
thereto reference is hereby made for a statement of the respective rights,
duties and obligations thereunder of the Company, the Trustee and the Holders of
the Notes and the terms upon which the Notes are to be authenticated and
delivered. The terms of individual Notes may vary with respect to interest
rates or interest rate formulas, issue
4
<PAGE>
dates, maturity, redemption, repayment and otherwise. The Notes may be issued
from time to time in an aggregate initial offering price up to $150,000,000,
which amount may be increased if duly authorized by the Company.
Except as otherwise provided in the Indenture, this Note will be issued in
global form only registered in the name of the Depositary or its nominee. This
Note will not be issued in definitive form, except as otherwise provided in the
Indenture, and ownership of this Note shall be maintained in book-entry form by
the Depositary for the accounts of participating organizations of the
Depositary.
Unless otherwise provided above and in accordance with the provisions
herein, this Note is not subject to any sinking fund and is not redeemable or
repayable prior to the Stated Maturity Date.
If so provided above, this Note may be redeemed by the Company on any date
on and after the Initial Redemption Date, if any, specified above. If no
Initial Redemption Date is set forth above, this Note may not be redeemed prior
to the Stated Maturity Date. On and after the Initial Redemption Date, if any,
this Note may be redeemed at any time in whole or from time to time in part in
increments of $1,000 (provided that any remaining principal hereof shall be at
least $1,000) at the option of the Company at the applicable Redemption Price
(as defined below), together with accrued interest hereon at the applicable rate
payable to the date of redemption (each such date, a "Redemption Date"), on
written notice to the Holder hereof given not more than 60 nor less than 30 days
prior to the Redemption Date and in accordance with the provisions of the
Indenture. In the event of redemption of this Note in part only, a new Note for
the unredeemed portion hereof shall be issued in the name of the Holder hereof
upon the surrender hereof.
Unless otherwise specified above, the "Redemption Price" shall initially be
the Initial Redemption Percentage, specified above, of the principal amount of
this Note to be redeemed and shall decline at each anniversary of the Initial
Redemption Date, shown above, by the Annual Redemption Percentage Reduction, if
any, specified above, of the principal amount to be redeemed until the
Redemption Price is 100% of such principal amount.
This Note may be subject to repayment at the option of the Holder on any
Optional Repayment Date(s), if any, indicated above. If no Optional Repayment
Date(s) are set forth above, this Note may not be so repaid at the option of the
Holder hereof prior to the Stated Maturity Date. On any Optional Repayment
Date, this Note shall be repayable in whole or in part in increments of $1,000
(provided that any remaining principal hereof shall be at least $1,000) at the
option of the Holder hereof at a repayment price, unless otherwise specified
above, equal to 100% of the principal amount to be repaid, together with
interest thereon payable to the date of repayment. For this Note to be repaid
in whole or in part at the option of the Holder hereof, this Note must be
received, with the form entitled "Option to Elect Repayment" below duly
completed, by
5
<PAGE>
the Trustee at its Corporate Trust Office, or such other address of which the
Company shall from time to time notify the Holders of the Notes, not more than
60 nor less than 30 days prior to the related Optional Repayment Date. Exercise
of such repayment option by the Holder hereof shall be irrevocable. With respect
to Notes represented by global securities, any option for repayment may be
exercised by the Depositary, on behalf of the owners of the beneficial interest
in the Notes represented by such global securities, by delivering a written
notice substantially similar to the above-referenced form, duly completed, to
the Trustee at the place and within the time period described above. All such
notices shall be irrevocable.
The interest rate borne by this Note shall be determined as follows:
1. If this Note is designated as a Regular Floating Rate Note above,
then, except as described below, this Note shall bear interest at the rate
determined by reference to the applicable Interest Rate Basis shown above
(i) plus or minus the applicable Spread, if any, and/or (ii) multiplied by
the applicable Spread Multiplier, if any, specified and applied in the
manner described above. Commencing on the Initial Interest Reset Date, the
rate at which interest on this Note is payable shall be reset as of each
Interest Reset Date specified above; provided, however, that (i) the
-------- -------
interest rate in effect for the period from the Original Issue Date to the
Initial Interest Reset Date will be the Initial Interest Rate, and (ii)
unless otherwise specified above, the interest rate in effect hereon for
the ten days immediately prior to Maturity shall be that in effect on the
tenth day preceding such Maturity.
2. If this Note is designated as a Floating Rate/Fixed Rate Note
above, then, except as described below, this Note shall bear interest at
the rate determined by reference to the applicable Interest Rate Basis
shown above (i) plus or minus the applicable Spread, if any, and/or (ii)
multiplied by the applicable Spread Multiplier, if any, specified and
applied in the manner described above. Commencing on the Initial Interest
Reset Date, the rate at which interest on this Note is payable shall be
reset as of each Interest Reset Date specified above; provided, however,
-------- -------
that (i) the interest rate in effect for the period from the Original Issue
Date to the Initial Interest Reset Date shall be the Initial Interest Rate,
(ii) unless otherwise specified above, the interest rate in effect hereon
for the ten days immediately prior to the Fixed Rate Commencement Date
shall be that in effect on the tenth day preceding the Fixed Rate
Commencement Date, and (iii) the interest rate in effect commencing on, and
including, the Fixed Rate Commencement Date to Maturity shall be the Fixed
Interest Rate, if such a rate is specified above, or if no such Fixed
Interest Rate is so specified, the interest rate in effect hereon on the
day immediately preceding the Fixed Rate Commencement Date.
3. If this Note is designated as an Inverse Floating Rate Note above,
then, except as described below, this Note will bear interest equal to the
Fixed
6
<PAGE>
Interest Rate indicated above minus the rate determined by reference to the
Interest Rate Basis shown above (i) plus or minus the applicable Spread, if
any, and/or (ii) multiplied by the applicable Spread Multiplier, if any,
specified and applied in the manner described above. Commencing on the
Initial Interest Reset Date, the rate at which interest on this Note is
payable shall be reset as of each Interest Reset Date specified above;
provided, however, that (i) the interest rate in effect for the period from
-------- -------
the Original Issue Date to the Initial Interest Reset Date shall be the
Initial Interest Rate, and (ii) unless otherwise specified above, the
interest rate in effect hereon for the ten days immediately prior to
Maturity shall be that in effect on the tenth day preceding such Maturity.
4. Notwithstanding the foregoing, if this Note is designated above as
having an Addendum attached, the Note shall bear interest in accordance
with the terms described in such Addendum.
Except as provided above, the interest rate in effect on each day shall be
(a) if such day is an Interest Reset Date, the interest rate determined as of
the Interest Determination Date (as defined below) immediately preceding such
Interest Reset Date or (b) if such day is not an Interest Reset Date, the
interest rate determined as of the Interest Determination Date immediately
preceding the next preceding Interest Reset Date. The interest rate with
respect to each Interest Rate Basis shall be determined in accordance with the
applicable provision below. If any Interest Reset Date (which term includes the
term Initial Interest Reset Date unless the context otherwise requires) would
otherwise be a day that is not a Business Day, such Interest Reset Date shall be
postponed to the next succeeding day that is a Business Day, except that if an
Interest Rate Basis specified on the face hereof is LIBOR and such next Business
Day falls in the next succeeding calendar month, such Interest Reset Date shall
be the next preceding Business Day.
Unless otherwise specified above, interest payable on this Note on any
Interest Payment Date shall be the amount of interest accrued from and including
the next preceding Interest Payment Date in respect of which interest has been
paid (or from and including the Original Issue Date specified above, if no
interest has been paid), to but excluding the related Interest Payment Date;
provided, however, that if the Interest Rate Reset Period with respect to this
- -------- -------
Note is daily or weekly, interest payable on any Interest Payment Date will
include interest accrued from and including the Original Issue Date, if no
interest has been paid, or from but excluding the last record date to which
interest has been paid, as the case may be, through and including the record
date next preceding such Interest Payment Date; and provided, further, that the
interest payments on Maturity will include interest accrued to but excluding the
date of Maturity. Unless otherwise specified above, accrued interest hereon for
any period shall be the amount calculated by multiplying the face amount hereof
by an accrued interest factor for such period. Such accrued interest factor
shall be computed by adding the interest factor calculated for each day in the
period for which accrued interest is being calculated. Unless otherwise
specified above, the interest factor for each such day shall be computed by
dividing the interest rate applicable to such day by 360 if the Interest Rate
Basis specified above is the
7
<PAGE>
CD Rate, the Commercial Paper Rate, the Eleventh District Cost of Funds Rate,
The Federal Fund Rate, LIBOR or the Prime Rate for the period specified
thereunder or by the actual number of days in the year if the Interest Rate
Basis specified above is the Treasury Rate for the period specified thereunder.
The interest factor for Notes for which the interest rate is calculated with
reference to two or more Interest Rate Bases will be calculated in each period
in the same manner as if only one of the applicable Interest Rate Bases applied
as specified above.
Unless otherwise specified above, the "Interest Determination Date" with
respect to the CD Rate, the Commercial Paper Rate, the Federal Funds Rate and
the Prime Rate will be the second Business Day preceding each Interest Reset
Date; the "Interest Determination Date" with respect to LIBOR shall be the
second London Business Day (as defined below) preceding each Interest Reset
Date: the "Interest Determination Date" with respect to the Eleventh District
Cost of Funds Rate shall be the last working day of the month immediately
preceding each Interest Reset Date on which the Federal Home Loan Bank of San
Francisco (the "FHLB of San Francisco") publishes the Index (as defined below);
the "Interest Determination Date" with respect to the Treasury Rate will be the
day in the week in which the related Interest Reset Date falls on which day
Treasury bills (as defined below) normally would be auctioned (Treasury bills
are normally sold at auction on Monday of each week, unless that day is a legal
holiday, in which case the auction is normally held on the following Tuesday,
except that such auction may be held on the preceding Friday); provided,
--------
however, that if an auction is held on the Friday of the week preceding the
- -------
related Interest Reset Date, the related Interest Determination Date shall be
such preceding Friday; and provided, further, that if an auction shall fall on
-------- -------
any Interest Reset Date, then the Interest Reset Date shall instead be the first
Business Day following such auction. If the interest rate of this Note is
determined with reference to two or more Interest Rate Bases, the Interest
Determination Date pertaining to this Note will be the latest Business Day which
is at least two Business Days prior to such Interest Reset Date on which each
Interest Rate Basis shall be determinable. Each Interest Rate Basis shall be
determined on such date, and the applicable interest rate shall take effect on
the related Interest Reset Date.
Unless otherwise specified above, the "Calculation Date" pertaining to any
Interest Determination Date will be the earlier of (i) the tenth calendar day
after such Interest Determination Date or; if such day is not a Business Day,
the next succeeding Business Day or (ii) the Business Day preceding the
applicable Interest Payment Date or Maturity, as the case may be. All
calculations on this Note shall be made by the Calculation Agent specified above
or such successor thereto as is duly appointed by the Company.
All percentages resulting from any calculation on this Note will be rounded
to the nearest one hundred-thousandth of a percentage point, with five one
millionths of a percentage point rounded upwards (e.g., 9.876545% (or .09876545)
----
would be rounded to 9.87655% (or .0987655)), and all dollar amounts used in or
resulting from such
8
<PAGE>
calculation will be rounded to the nearest cent (with one-half cent being
rounded upward).
As used herein, "Business Day" means, unless otherwise specified above, any
day other than Saturday or Sunday, that is neither a legal holiday nor a day on
which banking institutions are authorized or required by law, regulation or
executive order to close in The City of New York and, if the Interest Rate Basis
shown above is LIBOR, is also a London Business Day.
As used herein, "London Business Day" means any day on which dealings in
deposits in U.S. dollars are transacted in the London interbank market.
Determination of CD Rate. The CD Rate means, with respect to any Interest
------------------------
Determination Date relating to a Note for which the Base Rate is the CD Rate or
any Interest Determination Date for a Note for which the interest rate is
determined with reference to the CD Rate (a "CD Rate Interest Determination
Date"), the rate on such date for negotiable United States dollar certificates
of deposit having the Index Maturity specified above as published by the Board
of Governors of the Federal Reserve System in "Statistical Release H.15(519),
Selected Interest Rates" or any successor publication ("H.15(519)") under the
heading "CDs (Secondary Market)", or, if not published by 3:00 P.M., New York
City time, on the related Calculation Date, the rate on such CD Rate Interest
Determination Date for negotiable United States dollar certificates of deposit
of the Index Maturity specified above as published by the Federal Reserve Bank
of New York in its daily statistical release "Composite 3:30 P.M. Quotations for
U.S. Government Securities" or any successor publication ("Composite
Quotations") under the heading "Certificates of Deposit." If such rate is not
yet published in either H.15(519) or the Composite Quotations by 3:00 P.M., New
York City time, on the related Calculation Date, then the CD Rate on such CD
Rate Interest Determination Date will be calculated by the Calculation Agent and
will be the arithmetic mean of the secondary market offered rates as of 10:00
A.M., New York City time, on such CD Rate Interest Determination Date, of three
leading non-bank dealers in negotiable United States dollar certificates of
deposit in The City of New York selected by the Calculation Agent (after
consultation with the Company) for negotiable United States dollar certificates
of deposit of major United States money center banks for negotiable certificates
of deposit with a remaining maturity closest to the Index Maturity designated
above in an amount that is representative for a single transaction in that
market at that time; provided, however, that if the dealers selected as
-------- -------
aforesaid by the Calculation Agent are not quoting as set forth above, the CD
Rate determined as of such CD Rate Interest Determination Date shall be the CD
Rate in effect on such CD Rate Interest Determination Date.
Determination of Commercial Paper Rate. The Commercial Paper Rate means,
--------------------------------------
with respect to any Interest Determination Date relating to a Note for which the
Base Rate is the Commercial Paper Rate or any Interest Determination Date for a
Note for which the interest rate is determined with reference to the Commercial
Paper Rate (a "Commercial Paper Rate Interest Determination Date"), the Money
Market Yield (as
9
<PAGE>
defined below) on such date of the rate for commercial paper having the Index
Maturity specified above as published in H.15(519), under the heading
"Commercial Paper-Nonfinancial." In the event such rate is not published by 3:00
P.M., New York City time, on the related Calculation Date, then the Commercial
Paper Rate shall be the Money Market Yield on such Commercial Paper Rate
Interest Determination Date of the rate for commercial paper having the Index
Maturity shown above as published in Composite Quotations under the heading
"Commercial Paper" (with an Index Maturity of one month or three months being
deemed to be equivalent to an Index Maturity of 30 days or 90 days,
respectively). If by 3:00 P.M., New York City time, on the related Calculation
Date such rate is not yet published in either H.15(519) or Composite Quotations,
then the Commercial Paper Rate on such Commercial Paper Rate Interest
Determination Date shall be calculated by the Calculation Agent and shall be the
Money Market Yield of the arithmetic mean of the offered rates at approximately
11:00 A.M., New York City time, on such Commercial Paper Rate Interest
Determination Date of three leading dealers of commercial paper in The City of
New York selected by the Calculation Agent (after consultation with the Company)
for commercial paper having the Index Maturity specified above placed for a
nonfinancial entity whose bond rating is "Aa," or the equivalent, from a
nationally recognized statistical rating organization; provided, however, that
-------- -------
if the dealers selected as aforesaid by the Calculation Agent are not quoting as
mentioned in this sentence, the Commercial Paper Rate determined on such
Commercial Paper Rate Interest Determination Date shall be the Commercial Paper
Rate in effect on such Commercial Paper Rate Interest Determination Date.
"Money Market Yield" shall be a yield (expressed as a percentage)
calculated in accordance with the following formula:
Money Market Yield = D x 365 x 100
-------------
360 - (D x M)
where "D" refers to the applicable per annum rate for commercial paper quoted on
a bank discount basis and expressed as a decimal and "M" refers to the actual
number of days in the applicable Interest Rate Reset Period.
Determination of Eleventh District Cost of Funds Rate. The Eleventh
-----------------------------------------------------
District Cost of Funds Rate means, with respect to any Interest Determination
Date relating to a Note for which the Base Rate is the Eleventh District Cost of
Funds Rate or any Interest Determination Date for a Note for which the interest
rate is determined with reference to the Eleventh District Cost of Funds Rate
(an "Eleventh District Cost of Funds Rate Interest Determination Date"), the
rate equal to the monthly weighted average cost of funds for the calendar month
immediately preceding such Eleventh District Cost of Funds Rate Interest
Determination Date as set forth under the caption "11th District" on Telerate
Page 7058 as of 11:00 A.M., San Francisco time, on such Eleventh District Cost
of Funds Rate Interest Determination Date. If such rate does not appear on
Telerate Page 7058 on any related Eleventh District Cost of Funds Rate Interest
Determination Date, the Eleventh District Cost of Funds Rate for such Eleventh
District Cost of Funds Rate
10
<PAGE>
Interest Determination Date shall be the monthly weighted average cost of funds
paid by member institutions of the Eleventh Federal Home Loan Bank District that
was most recently announced (the "Index") by the FHLB of San Francisco as such
cost of funds for the calendar month preceding such Eleventh District Cost of
Funds Rate Interest Determination Date. If the FHLB of San Francisco fails to
announce the Index on or prior to such Eleventh District Cost of Funds Rate
Interest Determination Date for the calendar month next preceding such Eleventh
District Cost of Funds Rate Interest Determination Date, then the Eleventh
District Cost of Funds Rate for such Eleventh District Cost of Funds Rate
Interest Determination Date shall be the Eleventh District Cost of Funds Rate in
effect on such Eleventh District Cost of Funds Rate Interest Determination Date.
Determination of Federal Funds Rate. The Federal Funds Rate means, with
-----------------------------------
respect to any Interest Determination Date relating to a Note for which the Base
Rate is the Federal Funds Rate or any Interest Determination Date for a Note for
which the interest rate is determined with reference to the Federal Funds Rate
(a "Federal Funds Rate Interest Determination Date"), the rate on that date for
United States dollar federal funds as published in H.15(519) under the heading
"Federal Funds (Effective)" or, if not published by 3:00 P.M., New York City
time, on the related Calculation Date, the rate on such Federal Funds Rate
Interest Determination Date as published in Composite Quotations under the
heading "Federal Funds/Effective Rate." If by 3:00 P.M., New York City time, on
the related Calculation Date such rate is not published in either H.15(519) or
Composite Quotations, then the Federal Funds Rate on such Federal Funds Rate
Interest Determination Date shall be calculated by the Calculation Agent and
shall be the arithmetic mean of the rates for the last transaction in overnight
United States dollar federal funds arranged by three leading brokers of federal
funds transactions in The City of New York, selected by the Calculation Agent
(after consultation with the Company) prior to 9:00 A.M., New York City time, on
such Federal Funds Rate Interest Determination Date; provided, however, that if
-------- -------
the brokers selected as aforesaid by the Calculation Agent are not quoting as
mentioned in this sentence, the Federal Funds Rate with respect to such Federal
Funds Rate Interest Determination Date shall be the Federal Funds Rate in effect
on such Federal Funds Rate Interest Determination Date.
Determination of LIBOR. If an Interest Rate Basis for this Note is LIBOR,
----------------------
as indicated above, LIBOR will be determined by the Calculation Agent on the
applicable Interest Determination Date (a "LIBOR Interest Determination Date"),
as follows:
(a) (i) if "LIBOR Reuters" is specified above, the arithmetic mean of
the offered rates (unless the specified Designated LIBOR Page (as defined
below) by its terms provides only for a single rate, in which case such
single rate shall be used) for deposits in United States dollars having the
Index Maturity specified above, commencing on the second London Business Day
immediately following such LIBOR Interest Determination Date, that appear on
the Designated LIBOR Page specified above as of 11:00 A.M., London time, on
that LIBOR Interest Determination Date, if at least two such offered rates
appear (unless, as aforesaid,
11
<PAGE>
only a single rate is required) on such Designated LIBOR Page, or (ii) if
"LIBOR Telerate" is specified above, or if neither "LIBOR Reuters" nor
"LIBOR Telerate" is specified above as the method for calculating LIBOR, the
rate for deposits in United States dollars having the Index Maturity
specified above commencing on the second London Business Day immediately
following such LIBOR Interest Determination Reset Date that appears on the
Designated LIBOR Page specified above as of 11:00 A.M., London time, on that
LIBOR Interest Determination Date. If fewer than two offered rates appear,
or no rate appears, as applicable, LIBOR in respect of the related LIBOR
Interest Determination Date will be determined as if the parties had
specified the rate described in paragraph (b) below.
(b) With respect to a LIBOR Interest Determination Date on which fewer
than two offered rates appear, or no rate appears, as the case may be, on
the Designated LIBOR Page as specified above, the Calculation Agent shall
request the principal London offices of each of four major reference banks
in the London interbank market, as selected by the Calculation Agent (after
consultation with the Company), to provide the Calculation Agent with its
offered quotation for deposits in United States dollars for the period of
the Index Maturity shown above, commencing on the second London Business Day
immediately following such LIBOR Interest Determination Date, to prime banks
in the London interbank market at approximately 11:00 A.M., London time, on
such LIBOR Interest Determination Date and in a principal amount that is
representative for a single transaction in United States dollars in such
market at such time. If at least two such quotations are provided, LIBOR
determined on such LIBOR Interest Determination Date shall be the arithmetic
mean of such quotations as determined by the Calculation Agent. If fewer
than two quotations are provided, LIBOR determined on such LIBOR Interest
Determination Date shall be calculated by the Calculation Agent as the
arithmetic mean of the rates quoted at approximately 11:00 A.M., New York
time, on such LIBOR Interest Determination Date by three major banks in The
City of New York selected by the Calculation Agent (after consultation with
the Company) for loans in United States dollars to leading European banks,
having the Index Maturity specified above and in a principal amount that is
representative for a single transaction in United States dollars in such
market at such time; provided, however, that if the banks selected as
-------- -------
aforesaid by the Calculation Agent are not quoting as mentioned in this
sentence, LIBOR determined on such LIBOR Interest Determination Date shall
be LIBOR in effect on such LIBOR Interest Determination Date.
"Designated LIBOR Page" means either (a) if "LIBOR Reuters" is
specified above, the display on the Reuter Monitor Money Rates Service (or
any successor service) on the page specified above (or any other page as may
replace such page on such service) for the purpose of displaying the London
interbank rates of major banks for United States dollars or (b) if "LIBOR
Telerate" is specified above or neither "LIBOR Reuters" nor "LIBOR Telerate"
is specified above as the method for calculating LIBOR, the display on the
Dow Jones Markets
12
<PAGE>
Limited (or any successor service) on the page specified above (or any other
page as may replace such page on such service) for the purpose of displaying
the London interbank rates of major banks for United States dollars.
Determination of Prime Rate. The Prime Rate means, with respect to any
---------------------------
Interest Determination Date relating to a Note for which the Base Rate is the
Prime Rate or any Interest Determination Date for a Note for which the interest
rate is determined with reference to the Prime Rate (a "Prime Rate Interest
Determination Date"), the rate on such date as such rate is published in
H.15(519) under the heading "Bank Prime Loan." If such rate is not published
prior to 3:00 P.M., New York City time, on the related Calculation Date, then
the Prime Rate shall be determined by the Calculation Agent and shall be the
arithmetic mean of the rates of interest publicly announced by each bank that
appears on the Reuters Screen USPRIME1 Page (as defined below) as such bank's
prime rate or base lending rate as in effect for that Prime Rate Interest
Determination Date. If fewer than four such rates appear on the Reuters Screen
USPRIME1 Page for such Prime Rate Interest Determination Date, the Prime Rate
shall be determined by the Calculation Agent and shall be the arithmetic mean of
the prime or base lending rates quoted on the basis of the actual number of days
in the year divided by a 360-day year as of the close of business on such Prime
Rate Interest Determination Date by four major money center banks in The City of
New York selected by the Calculation Agent (after consultation with the
Company). If fewer than four such quotations are so provided by such major
money center banks, the Prime Rate will be determined by the Calculation Agent
and shall be the arithmetic mean of four prime rates quoted on the basis of the
actual number of days in the year divided by a 360-day year as of the close of
business on such Prime Rate Interest Determination Date as furnished in The City
of New York by the major money center banks, if any, that have provided such
quotations and by a reasonable number of substitute banks or trust companies to
obtain four such prime rate quotations, provided such substitute banks or trust
companies are organized and doing business under the laws of the United States,
or any state thereof, each having total equity capital of at least $500 million
and being subject to supervision or examination by Federal or state authority,
selected by the Calculation Agent (after consultation with the Company) to
provide such rate or rates; provided, however, that if the banks or trust
-------- -------
companies selected as aforesaid by the Calculation Agent are not quoting as
mentioned in this sentence, the Prime Rate for such Prime Rate Interest
Determination Date will be the Prime Rate in effect on such Prime Rate Interest
Determination Date.
"Reuters Screen USPRIME1 Page" means the display on the Reuter Monitor
Money Rates Service (or any successor service) on the "USPRIME1" page (or such
other page as may replace the USPRIME1 page on such service) for the purpose of
displaying prime rates or base lending rates of major United States banks.
Determination of Treasury Rate. The Treasury Rate means, with respect to
------------------------------
any Interest Determination Date relating to a Note for which the Base Rate is
the Treasury Rate or any Interest Determination Date for a Note for which the
interest rate is determined with reference to the Treasury Rate (a "Treasury
Rate Interest Determination
13
<PAGE>
Date"), the rate applicable to the auction held on such Treasury Rate Interest
Determination Date (the "Auction") of direct obligations of the United States
("Treasury bills") having the Index Maturity specified above, as such rate is
published in H.15(519) under the heading "Treasury Bills -- auction average
(investment)" or, if not published by 3:00 P.M., New York City time, on the
related Calculation Date, the auction average rate of such Treasury bills
(expressed as a bond equivalent on the basis of a year of 365 or 366 days, as
applicable, and applied on a daily basis) as otherwise announced by the United
States Department of the Treasury. In the event that the results of the Auction
of Treasury bills having the Index Maturity specified above are not reported as
provided by 3:00 P.M., New York City time, on such Calculation Date, or if no
such Auction is held, then the Treasury Rate shall be calculated by the
Calculation Agent and shall be a yield to maturity (expressed as a bond
equivalent on the basis of a year of 365 or 366 days, as applicable, and applied
on a daily basis) of the arithmetic mean of the secondary market bid rates, as
of approximately 3:30 P.M., New York City time, on such Treasury Rate Interest
Determination Date, of three leading primary United States government securities
dealers selected by the Calculation Agent (after consultation with the Company),
for the issue of Treasury bills with a remaining maturity closest to the Index
Maturity specified above; provided, however, that if the dealers selected
-----------------
as aforesaid by the Calculation Agent are not quoting as mentioned in this
sentence, the Treasury Rate with respect to such Treasury Rate Interest
Determination Date will be the Treasury Rate in effect on such Treasury Rate
Interest Determination Date.
Any provision contained herein with respect to the determination of an
Interest Rate Basis, the specification of an Interest Rate Basis, calculation of
the Interest Rate applicable to this Note, its payment dates or any other matter
relating hereto may be modified as specified in an Addendum relating hereto if
so specified above.
Notwithstanding the foregoing, the interest rate hereon shall not be
greater than the Maximum Interest Rate, if any, or less than the Minimum
Interest Rate, if any, specified above. The Calculation Agent shall calculate
the interest rate hereon in accordance with the foregoing on or before each
Calculation Date. The interest rate on this Note will in no event be higher
than the maximum rate permitted by California law, as the same may be modified
by United States law, of general application.
At the request of the Holder hereof, the Calculation Agent shall provide to
the Holder hereof the interest rate hereon then in effect and, if determined,
the interest rate which shall become effective as of the next Interest Reset
Date.
The Notes shall have the Events of Default as set forth in Section 501 of
the Indenture. If an Event of Default with respect to the Notes shall occur and
be continuing, the principal of all the Notes may be declared due and payable in
the manner and with the effect provided in the Indenture.
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company
14
<PAGE>
and the rights of the Holders of the Securities of each series to be affected
under the Indenture at any time by the Company and the Trustee with the consent
of the Holders of 66 2/3% in aggregate principal amount of the Outstanding
Securities of each series affected thereby. The Indenture also contains
provisions permitting the Holders of specified percentages in aggregate
principal amount of the Securities of each series at the time Outstanding, on
behalf of the Holders of all Securities of such series, to waive compliance by
the Company with certain provisions of the Indenture and certain past defaults
under the Indenture and their consequences. Any such consent or waiver by the
Holder of this Note shall be conclusive and binding upon such Holder and upon
all future Holders of this Note and of any Note issued upon the registration of
transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent or waiver is made upon this Note.
This Note is subject to satisfaction, discharge and defeasance as provided
in Article Four of the Indenture.
No reference herein to the Indenture and no provision of this Note or of
the Indenture shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay the principal of, premium, if any, and
interest on this Note at the time, place and rate, and in the coin or currency,
herein prescribed.
The Indenture contains provisions, which provisions apply to the Notes, for
(i) the defeasance of the indebtedness evidenced by the Notes and (ii) the
satisfaction and discharge of the Indenture, in each case upon compliance with
certain conditions, and subject to certain exceptions, set forth in the
Indenture.
As provided in the Indenture and subject to certain limitations therein set
forth, the transfer of this Note may be registered on the registry books of the
Company, upon surrender of this Note for registration of transfer at the office
or agency of the Company maintained by the Company for such purpose in the
Borough of Manhattan, The City of New York, duly endorsed by, or accompanied by
a written instrument of transfer in form satisfactory to the Company and the
Trustee duly executed by, the Holder hereof or by its attorney duly authorized
in writing, and thereupon one or more new Notes, of authorized denominations and
for the same aggregate principal amount, having the identical Original Issue
Date, Stated Maturity and provisions with respect to payment of interest and
redemption or repayment prior to Stated Maturity will be issued to the
designated transferee or transferees.
The Notes are issuable only in registered form without coupons in
denominations of $1,000 and integral multiples thereof. As provided in the
Indenture and subject to certain limitations therein set forth, the Notes are
exchangeable for a like aggregate principal amount of Notes as requested by the
Holder surrendering the same.
No service charge shall be made by the Company or the Trustee for any such
registration of transfer or exchange, but the Company may require payment of a
sum sufficient to cover any tax or other governmental charge that may be imposed
in
15
<PAGE>
connection therewith (other than exchanges pursuant to the Indenture not
involving any transfer).
Prior to due presentment of this Note for registration of transfer, the
Company, the Trustee and any agent of the Company or the Trustee may treat the
Person in whose name this Note is registered as the owner hereof for all
purposes, whether or not this Note be overdue, and neither the Company, the
Trustee nor any such agent shall be affected by notice to the contrary.
If money for the payment of principal or interest remains unclaimed for
three years, the Trustee or any paying agent will pay the money back to the
Company at its request. After any such payment, Holders entitled to the money
as an unsecured creditor, must look to the Company for payment and all liability
of the Trustee or such paying agent with respect to such money shall cease.
The terms of this Note include those stated in the Indenture and those made
part of the Indenture by the Officers' Certificate delivered pursuant thereto
and the Trust Indenture Act. This Note is subject to all such terms, and
Noteholders are referred to the Indenture and said Act for a statement of them.
No stockholder, director, officer, employee or incorporator as such, past,
present or future, of the Company or any successor corporation shall have any
liability for any obligations of the Company under this Note or the Indenture or
for any claim based on, or in respect of or by reason of, such obligations or
their creation. Each holder of a Note by accepting a Note waives and releases
all such liability. The waiver and release are part of the consideration for
the issue of this Note.
The Trustee under the Indenture, in its individual or any other capacity,
may deal with the Company as if were not Trustee.
This Note shall be governed by and construed in accordance with the laws of
the State of California.
All terms used in this Note which are defined in the Indenture shall have
the meanings assigned to them in the Indenture.
16
<PAGE>
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed, manually or in facsimile, and an imprint or facsimile of its corporate
seal to be imprinted hereon.
[FACSIMILE OF SEAL] HEALTH CARE PROPERTY
INVESTORS, INC.
By: ________________________
Name:
Title:
Attest:
By: _________________________
Name:
Title:
Dated:
CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated
herein referred to in the within-mentioned Indenture.
THE BANK OF NEW YORK
as Trustee
By: __________________________
Authorized Signatory
17
<PAGE>
OPTION TO ELECT REPAYMENT
The undersigned hereby irrevocably request(s) and instructs) the Company to
repay this Note (or portion hereof specified below) pursuant to its terms at a
price equal to the principal amount hereof together with interest to the
repayment date, to the undersigned, at
_______________________________________________________________________________
_______________________________________________________________________________
(Please print or typewrite name and address of the undersigned)
For this Note to be repaid, the Trustee must receive at its Corporate Trust
Office, or at such other place or places of which the Company shall from time to
time notify the Holder of this Note, not more than 60 nor less than 30 days
prior to the Optional Repayment Date, if any, shown on the face of this Note,
this Note with this "Option to Elect Repayment" form duly completed.
If less than the entire principal amount of this Note is to be repaid,
specify the portion hereof (which shall be increments of $1,000) which the
Holder elects to have repaid $____________________ and specify the denomination
or denominations (which shall be $1,000 or an integral multiple thereof) of the
Notes to be issued to the Holder for the portion of this Note not being repaid
(in the absence of any such specification, one such Note will be issued for the
portion not being repaid) $____________________.
Date: _______________________ _______________________________________
The signature on this Option to Elect
Repayment must correspond with the
name as written upon the face of this
Note in every particular, without
alteration or enlargement or any
change whatever.
Signature Guarantee:
_____________________________
18
<PAGE>
ASSIGNMENT/TRANSFER FORM
FOR VALUE RECEIVED the undersigned registered Holder hereby sell(s),
assign(s) and transfers) unto (insert Taxpayer Identification no.)
___________________________ (Please print or typewrite name and address
including postal zip code of assignee) _____________________________________
the within Note and all rights thereunder, hereby irrevocably constituting and
appointing ___________________________________________________________________
attorney to transfer said Note on the books of the Company with full power of
substitution in the premises.
Dated: ________________________ _______________________________
NOTICE: The signature of the registered Holder on this assignment must
correspond with the name as written upon the face of the within
instrument in every particular, without alteration or enlargement or
any change whatsoever.
Signature Guarantee:
_________________________________
19
<PAGE>
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations.
TEN COM -- as tenants in common
UNIF GIFT MIN ACT -- Custodian
------------------ -----------------
(cust) (Minor)
Under Uniform Gifts to Minors Act
----------------------------------------------
(State)
TEN ENT -- as tenants by the entireties
JT TEN -- as joint tenants with right of survivorship and not as tenants in
common
Additional abbreviations may also be used though not in the above list.
20
<PAGE>
[FORM OF FIXED RATE GLOBAL MEDIUM-TERM NOTE]
[The following legend is for inclusion only in Book-Entry Securities for
which The Depository Trust Company serves as Depositary -- Unless this
certificate is presented by an authorized representative of The Depository Trust
Company, a New York corporation ("DTC"), to the Company or its agent for
registration of transfer, exchange or payment, and any certificate issued is
registered in the name of Cede & Co. or in such other name as is requested by an
authorized representative of DTC and any payment is made to Cede & Co. or to
such other entity as is requested by an authorized representative of DTC, ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest
herein.]
[The following legend is for inclusion only in Book-Entry Securities --
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN CERTIFICATED
FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A
NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR
ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A
SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY.]
REGISTERED PRINCIPAL AMOUNT
No. FX____ CUSIP NO. __________ $_______________
HEALTH CARE PROPERTY INVESTORS, INC.
MEDIUM-TERM NOTE, SERIES D
(FIXED RATE)
ORIGINAL ISSUE DATE: INTEREST RATE: STATED MATURITY DATE:
INTEREST PAYMENT DATES:
INITIAL REDEMPTION INITIAL REDEMPTION ANNUAL REDEMPTION
DATE PERCENTAGE: PERCENTAGE
REDUCTION:
OPTIONAL REPAYMENT DATE(S):
1
<PAGE>
DAY COUNT CONVENTION
[ ] 30/360 FOR THE PERIOD FROM TO
[ ] ACTUAL/360 FOR THE PERIOD FROM TO
[ ] ACTUAL/ACTUAL FOR THE PERIOD FROM TO
ADDENDUM ATTACHED: ORIGINAL ISSUE DISCOUNT:
[ ] Yes [ ] Yes
[ ] No [ ] No
Total Amount of OID:
Yield to Maturity:
Initial Accrual Period:
OTHER PROVISIONS:
2
<PAGE>
HEALTH CARE PROPERTY INVESTORS, INC., a Maryland corporation ("Issuer" or
the "Company," which terms include any successor corporation under the Indenture
hereinafter referred to), for value received, hereby promises to pay to
, or registered assigns, the Principal Amount specified above on the Stated
Maturity Date specified above (except to the extent redeemed or repaid prior to
the Stated Maturity Date), and to pay interest thereon at the Interest Rate per
annum specified above, until such Principal Amount is paid or duly made
available for payment. Reference herein to "this Note," "hereof," "herein" and
comparable terms shall include an Addendum hereto if an Addendum is specified
above.
The Company pay interest on each Interest Payment Date specified above,
commencing on the first Interest will Payment Date specified above next
succeeding the Original Issue Date specified above, and on the Stated Maturity
Date or any Redemption Date or Optional Repayment Date (the date of each such
Stated Maturity Date, Redemption Date and Optional Repayment Date and the date
on which principal or an installment of principal is due and payable by
declaration of acceleration pursuant to the Indenture being referred to
hereinafter as a "Maturity" with respect to principal payable on such date);
provided, however, that if the Original Issue Date is between a record date (as
- -------- -------
defined below) and the next succeeding Interest Payment Date, interest payments
will commence on the Interest Payment Date immediately following the next
succeeding record date to the registered Holder on such next succeeding record
date. Except as provided above, interest payments will be made on the Interest
Payment Dates shown above. Unless otherwise specified above, the "record date"
shall be the date 15 calendar days (whether or not a Business Day) immediately
preceding the applicable Interest Payment Date. Interest on this Note will
accrue from and including the most recent Interest Payment Date to which
interest has been paid or duly provided for or, if no interest has been paid,
from the Original Issue Date specified above, to, but excluding such Interest
Payment Date, as the case may be. If the Maturity or an Interest Payment Date
falls on a day which is not a Business Day as defined below, the payment due on
such Maturity or Interest Payment Date will be paid on the next succeeding
Business Day with the same force and effect as if made on such Maturity or
Interest Payment Date, as the case may be, and no interest shall accrue with
respect to such payment for the period from and after such Maturity or Interest
Payment Date. The interest so payable and punctually paid or duly provided for
on any Interest Payment Date will as provided in the Indenture be paid to the
Person in whose name this Note is registered at the close of business on the
record date for such Interest Payment Date. Any such interest which is payable,
but not punctually paid or duly provided for on any Interest Payment Date
(herein called "Defaulted Interest"), shall forthwith cease to be payable to the
registered Holder on such record date, and may be paid to the Person in whose
name this Note is registered at the close of business on a Special Record Date
(which shall be not more than 15 nor less than ten days prior to the date of
payment of such Defaulted Interest) established by notice given by mail by or on
behalf of the Company to the Holder of this Note not less than ten days
preceding such Special Record Date, all as more fully provided in the Indenture.
3
<PAGE>
Payment of interest on this Note will be made at the office or agency of
the Company maintained by the Company for such purpose in the Borough of
Manhattan, The City of New York, in such coin or currency of the United States
of America as at the time of payment is legal tender for payment of public and
private debts provided, however, that at the option of the Company, payment of
-------- -------
interest due other than at Maturity may be made by check mailed to the address
of the Person entitled thereto as such address shall appear in the registry
books of the Company, and provided, further, that the payment of the principal
-------- -------
of and interest on this Note on any Optional Repayment Date(s), if any,
indicated above shall be made upon satisfaction of the provisions herein; and
provided, further, that AT THE OPTION OF THE COMPANY, the Holder of Notes with
- -------- -------
an aggregate principal amount of $10,000,000 or more will be entitled to receive
payments of interest on this Note (other than at Maturity) by wire transfer of
immediately available funds if appropriate wire transfer instructions have been
received in writing by the Trustee (as defined below) not less than 15 days
prior to the applicable Interest Payment Date. Such wire instructions, upon
receipt by the Trustee, shall remain in effect until revoked by such Holder.
Payment of principal or premium, if any, at the Maturity of this Note will
be made in immediately available funds upon presentation of this Note at the
office or agency of the Company maintained by the Company for such purpose in
the Borough of Manhattan, The City of New York, or at such other place as the
Company may designate. Payment of interest due at Maturity will be made to the
person to whom payment of the principal of this Note shall be made.
Unless the certificate of authentication hereon has been executed by or on
behalf of the Trustee under the Indenture, by the manual signature of one of its
authorized signatories, this Note shall not be entitled to any benefit under the
Indenture or be valid or obligatory for any purpose.
This Note is one of a duly authorized series of Securities (hereinafter
called the "Securities") of the Company designated as its Medium-Term Notes,
Series D (the "Notes"). The Notes are issued and to be issued under an
Indenture dated as of September 1, 1993 (herein called the "Indenture") between
the Company and The Bank of New York, a corporation incorporated under the laws
of the State of New York, as trustee (the "Trustee," which term includes any
successor trustee with respect to the Notes under the Indenture), to which
Indenture and all indentures supplemental thereto reference is hereby made for a
statement of the respective rights, duties and obligations thereunder of the
Company, the Trustee and the Holders of the Notes and the terms upon which the
Notes are to be authenticated and delivered. The terms of individual Notes may
vary with respect to interest rates or interest rate formulas, issue dates,
maturity, redemption, repayment and otherwise. The Notes may be issued from
time to time in an aggregate initial offering price up to $150,000,000, which
amount may be increased if duly authorized by the Company.
4
<PAGE>
Except as otherwise provided in the Indenture, this Note will be issued in
global form only registered in the name of the Depositary or its nominee. This
Note will not be issued in definitive form, except as otherwise provided in the
Indenture, and ownership of this Note shall be maintained in book-entry form by
the Depositary for the accounts of participating organizations of the
Depositary.
Unless otherwise provided above and in accordance with the provisions
herein, this Note is not subject to any sinking fund and is not redeemable or
repayable prior to the Stated Maturity Date.
If so provided above, this Note may be redeemed by the Company on any date
on and after the Initial Redemption Date, if any, specified above. If no
Initial Redemption Date is set forth above, this Note may not be redeemed prior
to the Stated Maturity Date. On and after the Initial Redemption Date, if any,
this Note may be redeemed at any time in whole or from time to time in part in
increments of $1,000 (provided that any remaining principal hereof shall be at
least $1,000) at the option of the Company at the applicable Redemption Price
(as defined below) together with accrued interest hereon at the applicable rate
payable to the date of redemption (each such date, a "Redemption Date"), on
written notice to the Holder hereof given not more than 60 nor less than 30 days
prior to the Redemption Date and in accordance with the provisions of the
Indenture. In the event of redemption of this Note in part only, a new Note for
the unredeemed portion hereof shall be issued in the name of the Holder hereof
upon the surrender hereof.
Unless otherwise specified above, the "Redemption Price" shall initially be
the Initial Redemption Percentage, specified above, of the principal amount of
this Note to be redeemed and shall decline at each anniversary of the Initial
Redemption Date, shown above, by the Annual Redemption Percentage Reduction, if
any, specified above, of the principal amount to be redeemed until the
Redemption Price is 100% of such principal amount.
This Note may be subject to repayment at the option of the Holder on any
Optional Repayment Date(s), if any, indicated above. If no Optional Repayment
Date(s) are set forth above, this Note may not be so repaid at the option of the
Holder hereof prior to the Stated Maturity Date. On any Optional Repayment
Date, this Note shall be repayable in whole or in part in increments of $1,000
(provided that any remaining principal hereof shall be at least $1,000) at the
option of the Holder hereof at a repayment price, unless otherwise specified
above, equal to 100% of the principal amount to be repaid, together with
interest thereon payable to the date of repayment. For this Note to be repaid
in whole or in part at the option of the Holder hereof, this Note must be
received, with the form entitled "Option to Elect Repayment" below duly
completed, by the Trustee at its Corporate Trust Office, or such other address
of which the Company shall from time to time notify the Holders of the Notes,
not more than 60 nor less than 30 days prior to the related Optional Repayment
Date. Exercise of such repayment option by the Holder hereof shall be
irrevocable. With respect to Notes represented by global
5
<PAGE>
securities, any option for repayment may be exercised by the Depositary, on
behalf of the owners of the beneficial interest in the Notes represented by such
global securities, by delivering a written notice substantially similar to the
above-referenced form, duly completed, to the Trustee at the place and within
the time period described above. All such notices shall be irrevocable.
Interest payments on this Note shall include interest accrued from, and
including, the Original Issue Date indicated above, or the most recent date to
which interest has been paid or duly provided for, to, but excluding, the
related Interest Payment Date or Maturity, as the case may be, until the
Principal Amount is paid or made available for payment. Unless otherwise
specified on the first page of this Note, interest payments for this Note shall
be computed and paid on the basis of a 360-day year of twelve 30-day months.
As used herein, "Business Day" means, unless otherwise specified above,
each Monday, Tuesday, Wednesday, Thursday and Friday which is not a day on which
banking institutions or trust companies in New York are authorized or obligated
by law to close.
Any provision contained herein with respect to the calculation of the rate
of interest applicable to this Note, its Payment dates or any other matter
relating hereto may be modified as specified in an Addendum relating hereto if
so specified above.
The Notes shall have the Events of Default as set forth in Section 501 of
the Indenture. If an Event of Default with respect to the Notes shall occur and
be continuing, the principal of all the Notes may be declared due and payable in
the manner and with the effect provided in the Indenture.
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Securities of each series to be
affected under the Indenture at any time by the Company and the Trustee with the
consent of the Holders of 66 2/3% in aggregate principal amount of the
Outstanding Securities of each series affected thereby. The Indenture also
contains provisions permitting the Holders of specified percentages in aggregate
principal amount of the Securities of each series at the time Outstanding, on
behalf of the Holders of all Securities of such series, to waive compliance by
the Company with certain provisions of the Indenture and certain past defaults
under the Indenture and their consequences. Any such consent or waiver by the
Holder of this Note shall be conclusive and binding upon such Holder and upon
all future Holders of this Note and of any Note issued upon the registration of
transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent or waiver is made upon this Note.
This Note is subject to satisfaction, discharge and defeasance as provided
in Article Four of the Indenture.
6
<PAGE>
No reference herein to the Indenture and no provision of this Note or of
the Indenture shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay the principal of, premium, if any, and
interest on this Note at the time, place and rate, and in the coin or currency
herein prescribed.
The Indenture imposes certain limitations on the ability of the Company to
incur indebtedness and consolidate, merge or transfer all or substantially all
of the Company's assets. These limitations are subject to certain
qualifications and exceptions, and reference is made to the Indenture for a
description thereof.
As provided in the Indenture and subject to certain limitations therein set
forth, the transfer of this Note may be registered on the registry books of the
Company, upon surrender of this Note for registration of transfer at the office
or agency of the Company maintained by the Company for such purpose in the
Borough of Manhattan, The City of New York, duly endorsed by, or accompanied by
a written instrument of transfer in form satisfactory to the Company and the
Trustee duly executed by, the Holder hereof or by its attorney duly authorized
in writing, and thereupon one or more new Notes, of authorized denominations and
for the same aggregate principal amount, having the identical Original Issue
Date, Stated Maturity and provisions with respect to payment of interest and
redemption or repayment prior to Stated Maturity will be issued to the
designated transferee or transferees.
The Notes are issuable only in registered form without coupons in
denominations of $1,000 and integral multiples thereof. As provided in the
Indenture and subject to certain limitations therein set forth, the Notes are
exchangeable for a like aggregate principal amount of Notes as requested by the
Holder surrendering the same.
No service charge shall be made by the Company or the Trustee for any such
registration of transfer or exchange, but the Company may require payment of a
sum sufficient to cover any tax or other governmental charge that may be imposed
in connection therewith (other than exchanges pursuant to the Indenture not
involving any transfer).
Prior to due presentment of this Note for registration of transfer, the
Company, the Trustee and any agent of the Company or the Trustee may treat the
Person in whose name this Note is registered as the owner hereof for all
purposes, whether or not this Note be overdue, and neither the Company, the
Trustee nor any such agent shall be affected by notice to the contrary.
If money for the payment of principal or interest remains unclaimed for
three years, the Trustee or any paying agent will pay the money back to the
Company at its request. After any such payment, Holders entitled to the money,
as an unsecured creditor, must look to the Company for payment and all liability
of the Trustee or such paying agent with respect to such money shall cease.
7
<PAGE>
The terms of this Note include those stated in the Indenture and those made
part of the Indenture by the Officers' Certificate delivered pursuant thereto
and the Trust Indenture Act. This Note is subject to all such terms, and
Noteholders are referred to the Indenture and said Act for a statement of them.
No stockholder, director, officer, employee or incorporator as such, past,
present or future, of the Company or any successor corporation shall have any
liability for any obligations of the Company under this Note or the Indenture or
for any claim based on, or in respect of or by reason of, such obligations or
their creation. Each holder of a Note by accepting a Note waives and releases
all such liability. The waiver and release are part of the consideration for
the issue of this Note.
The Trustee under the Indenture, in its individual or any other capacity,
may deal with the Company as if were not Trustee.
This Note shall be governed by and construed in accordance with the laws of
the State of California.
All terms used in this Note which are defined in the Indenture shall have
the meanings assigned to them in the Indenture.
8
<PAGE>
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed, manually or in facsimile, and an imprint or facsimile of its corporate
seal to be imprinted hereon.
[FACSIMILE OF SEAL] HEALTH CARE PROPERTY INVESTORS, INC.
By: ________________________________
Name:
Title:
Attest:
By: _______________________________________
Name:
Title:
Dated:
CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series
designated herein referred to in the
within-mentioned Indenture.
THE BANK OF NEW YORK
as Trustee
By: _______________________________________
Authorized Signatory
9
<PAGE>
OPTION TO ELECT REPAYMENT
The undersigned hereby irrevocably request(s) and instructs) the Company to
repay this Note (or portion hereof specified below) pursuant to its terms at a
price equal to the principal amount hereof together with interest to the
repayment date, to the undersigned, at
_______________________________________________________________________________
_______________________________________________________________________________
(Please print or typewrite name and address of the undersigned)
For this Note to be repaid, the Trustee must receive at its Corporate Trust
Office, or at such other place or places of which the Company shall from time to
time notify the Holder of this Note, not more than 60 nor less than 30 days
prior to the Optional Repayment Date, if any, shown on the face of this Note,
this Note with this "Option to Elect Repayment" form duly completed.
If less than the entire principal amount of this Note is to be repaid,
specify the portion hereof (which shall be increments of $1,000) which the
Holder elects to have repaid $____________________ and specify the denomination
or denominations (which shall be $1,000 or an integral multiple thereof) of the
Notes to be issued to the Holder for the portion of this Note not being repaid
(in the absence of any such specification, one such Note will be issued for the
portion not being repaid) $____________________.
Date: ________________________________ ___________________________________
The signature on this Option to
Elect Repayment must correspond with
the name as written upon the face of
this Note in every particular,
without alteration or enlargement or
any change whatever.
Signature Guarantee:
___________________________________
10
<PAGE>
ASSIGNMENT/TRANSFER FORM
FOR VALUE RECEIVED the undersigned registered Holder hereby sell(s),
assign(s) and transfers) unto (insert Taxpayer Identification no.) ____________
(Please print or typewrite name and address including postal zip code of
assignee) _____________________________________________________________________
the within Note and all rights thereunder, hereby irrevocably constituting and
appointing ________________________________attorney to transfer said Note on
the books of the Company with full power of substitution in the premises.
Dated: __________________________________ _________________________________
NOTICE: The signature of the registered Holder on this assignment must
correspond with the name as written upon the face of the within
instrument in every particular, without alteration or enlargement or
any change whatsoever.
Signature Guarantee:
__________________________________
11
<PAGE>
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations.
TEN COM -- as tenants in common
UNIF GIFT MIN ACT -- Custodian
--------------------- --------------------
(cust) (Minor)
Under Uniform Gifts to Minors Act
----------------------------------------------------
(State)
TEN ENT -- as tenants by the entireties
JT TEN -- as joint tenants with right of survivorship and not as tenants in
common
Additional abbreviations may also be used though not in the above list.
12
<PAGE>
EXHIBIT 5.1
[Letterhead of Ballard Spahr Andrews & Ingersoll, LLP]
August 27, 1998
Health Care Property Investors, Inc.
4675 MacArthur Court
Suite 900
Newport Beach, California 92660
Re: Health Care Property Investors, Inc., a Maryland
corporation (the "Company") - up to $150,000,000 aggregate initial
offering price of Medium Term Notes, Series D, Due Nine
Months or More from Date of Issue (the "Notes") pursuant to
Registration Statement on Form S-3 (Registration No. 333-57163)
---------------------------------------------------------------
Ladies and Gentlemen:
In connection with the registration of the Notes under the Securities Act of
1933, as amended (the "Act"), by the Company on Form S-3 filed with the
Securities and Exchange Commission on or about June 18, 1998 (the "Registration
Statement"), you have requested our opinion with respect to the matters set
forth below. Capitalized terms not otherwise defined herein shall have the
meanings ascribed to them in the Registration Statement.
We have acted as special Maryland corporate counsel for the Company in
connection with the matters described herein. In our capacity as special
Maryland corporate counsel to the Company, we have reviewed and are familiar
with proceedings proposed to be taken by the Company in connection with the
authorization, issuance and sale of the Notes, and for purposes of this opinion
have assumed such proceedings will be timely completed in the manner presently
proposed. In addition, we have relied upon certificates and advice from the
officers of the Company upon which we believe we are justified in relying and on
various certificates from, and documents recorded with, the State Department of
Assessments and Taxation of Maryland (the "SDAT"), including the charter of the
Company (the "Charter"), consisting of Articles of Restatement filed with the
SDAT on April 27, 1992 and Articles Supplementary filed with the SDAT on
September 26, 1997. We have also examined the Bylaws of the Company, as amended
through the date hereof (the "Bylaws"), Resolutions of the Board of Directors of
the Company adopted on or before the date hereof and in full force and effect on
the date hereof and an Indenture dated September 1, 1993 by and between the
Company and the Bank of New York, as Trustee
<PAGE>
Health Care Property Investors, Inc.
August 27, 1998
Page 2
(the "Indenture") and such laws, records, documents, certificates, opinions and
instruments as we deem necessary to render this opinion.
We have assumed the genuineness of all signatures, the authenticity of all
documents submitted to us as originals and the conformity to the originals of
all documents submitted to us as certified, photostatic or conformed copies. In
addition, we have assumed that each person executing any instrument, document or
certificate referred to herein on behalf of any party is duly authorized to do
so.
Based on the foregoing, and subject to the assumptions and qualifications set
forth herein, it is our opinion that, as of the date of this letter, the
execution and delivery by the Company of the Indenture and the issuance of the
Notes pursuant to the Indenture have been duly authorized by all necessary
corporate action on the part of the Company.
We consent to your filing this opinion as an exhibit to the Registration
Statement, and further consent to the filing of this opinion as an exhibit to
the applications to securities commissioners for the various states of the
United States for registration of the Notes. We also consent to the
identification of our firm as Maryland counsel to the Company in the section of
the Prospectus (which is part of the Registration Statement) entitled "Legal
Matters."
The opinions expressed herein are limited to the laws of the State of Maryland
and we express no opinion concerning any laws other than the laws of the State
of Maryland. Furthermore, the opinions presented in this letter are limited to
the matters specifically set forth herein and no other opinion shall be inferred
beyond the matters expressly stated.
Very truly yours,
/s/ Ballard Spahr Andrews & Ingersoll, LLP
<PAGE>
EXHIBIT 5.2
[Letterhead of Latham & Watkins]
August 27, 1998
Health Care Property Investors, Inc.
4675 MacArthur Court, 9th Floor
Newport Beach, California 92660
Re: Health Care Property Investors, Inc.
$150,000,000 Medium-Term Notes, Series D
----------------------------------------
Ladies and Gentlemen:
We have acted as special counsel to Health Care Property Investors, Inc., a
Maryland corporation (the "Company"), in connection with the registration under
the Securities Act of 1933, as amended (the "1933 Act"), and the issuance of up
to an aggregate initial offering price of $150,000,000 Medium-Term Notes, Series
D, due nine months or more from date of issue, having such terms and provisions
as set forth in an officers' certificate dated August 27, 1998 delivered
pursuant to Section 301 of the indenture dated as of September 1, 1993 (the
"Indenture") between the Company and The Bank of New York, as trustee (the
"Notes"), pursuant to (i) a registration statement on Form S-3 under the 1933
Act, filed with the Securities and Exchange Commission (the "Commission") on
June 18, 1998 (File No. 333-57163) and declared effective by the Commission on
June 30, 1998 (the "Registration Statement"), (ii) a Prospectus dated August 27,
1998, as supplemented by the Prospectus Supplement dated August 27, 1998, filed
with the Commission on August 27, 1998 pursuant to Rule 424(b) under the 1933
Act, and (iii) the distribution agreement dated as of August 27, 1998 among
Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated,
Goldman, Sachs & Co., NationsBanc Montgomery Securities LLC, BNY Capital
Markets, Inc. and the Company (the "Distribution Agreement").
In our capacity as your special counsel in connection with the Registration
Statement, we are generally familiar with the proceedings taken by the Company
in connection with the authorization and issuance of the Notes.
As to facts material to the opinions, statements and assumptions expressed
herein, we have, with your consent, relied exclusively upon oral or written
statements and representations of officers and other representations of the
Company and others. In addition, we have obtained and relied upon such
certificates and assurances from public officials as we have deemed necessary.
In our examination, we have assumed the genuineness of all signatures, the
authenticity of all documents submitted to us as
<PAGE>
Health Care Property Investors, Inc.
August 27, 1998
Page 2
originals and the conformity to authentic original documents of all documents
submitted to us as copies.
We are opining herein as to the effect on the subject transaction only of
the internal laws of the State of California, and we express no opinion with
respect to the applicability thereto, or the effect thereon, of the laws of any
other jurisdiction or as to any matters of municipal law or the laws of any
local agencies within any state. We understand that various matters concerning
the laws of the State of Maryland are addressed in an opinion of Ballard Spahr
Andrews & Ingersoll, LLP separately provided to you, and we express no opinion
with respect to those matters. In rendering the opinions set forth below, we
have, with your permission, assumed that the Company is duly incorporated and is
validly existing as a corporation in good standing under the laws of the State
of Maryland; that each of the Distribution Agreement, the Indenture and the
Notes has been duly authorized, executed and delivered by the Company; and that
none of the issuance and sale of the Notes by the Company, or the performance
and compliance by the Company with the provisions of the Distribution Agreement,
the Indenture or the Notes, or the consummation of the transactions contemplated
thereby, will result in any violation of the provisions of the charter or bylaws
of the Company.
Subject to the foregoing and the other matters set forth herein, it is our
opinion that, as of the date hereof, the Notes, when executed and authenticated
in accordance with the terms of the Indenture and delivered pursuant to the
provisions of the Distribution Agreement against payment of the consideration
therefor, will be legally valid and binding obligations of the Company,
enforceable against the Company in accordance with their terms.
Our opinion is subject to the following exceptions, limitations and
qualifications: (1) the effect of bankruptcy, insolvency, reorganization,
moratorium, fraudulent conveyance or other similar laws now or hereinafter in
effect relating to or affecting the rights and remedies of creditors; (2) the
effect of general principles of equity, including without limitation concepts of
materiality, reasonableness, good faith and fair dealing and the possible
unavailability of specific performance or injunctive relief (regardless of
whether enforcement is sought in a proceeding in equity or at law); and (3)
certain rights, remedies and waivers contained in the Indenture may be limited
or rendered ineffective by applicable California laws or judicial decisions
governing such provisions, but such laws or judicial decisions do not render the
Notes invalid or unenforceable as a whole.
To the extent that the obligations of the Company under the Notes may be
dependent upon such matters, we assume for purposes of this opinion that the
Trustee has complied with any applicable requirement to file returns and pay
taxes under the laws of the State of California; that the Trustee is duly
organized, validly existing and in good standing under the laws of its
jurisdiction of organization; that the Trustee is duly qualified to engage in
the activities contemplated by the Indenture; that the Indenture has
<PAGE>
Health Care Property Investors, Inc.
August 27, 1998
Page 3
been duly authorized, executed and delivered by the Trustee and constitutes the
legally valid and binding obligation of the Trustee enforceable against the
Trustee in accordance with its terms; the Trustee is in compliance, generally
and with respect to acting as a trustee under the Indenture, with all applicable
laws and regulations, and will be duly qualified under the Trust Indenture Act;
that the Trustee has the requisite organizational and legal power and authority
to perform its obligations under the Indenture; and that the Notes will be paid
for in accordance with the terms of the Distribution Agreement, and will be duly
authenticated by the Trustee in accordance with the Indenture and the Officers'
Certificate (as defined in the Indenture).
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement. This opinion may not be relied upon by you for any
other purpose, or furnished to, quoted to or relied upon by any other person,
firm or corporation for any purpose, without our prior written consent.
Very truly yours,
/s/ Latham & Watkins
<PAGE>
EXHIBIT 5.3
[Letterhead of Ballard Spahr Andrews & Ingersoll, LLP]
September 4, 1998
Health Care Property Investors, Inc.
4675 MacArthur Court
Suite 900
Newport Beach, California 92660
Re: Health Care Property Investors, Inc., a Maryland corporation (the
"Company") - up to Five Million Seven Hundred Fifty Thousand
(5,750,000) shares (the "Shares") of the Series B Cumulative
Redeemable Preferred Stock of the Company, par value $1.00 per share
(the "Series B Preferred Stock") to be issued and sold pursuant to
Registration Statement on Form S-3 (Registration No. 333-57163)
---------------------------------------------------------------
Ladies and Gentlemen:
In connection with the registration of the Shares under the Securities Act of
1933, as amended (the "Act"), by the Company on Form S-3 filed with the
Securities and Exchange Commission on or about June 18, 1998 (the "Registration
Statement"), you have requested our opinion with respect to the matters set
forth below. Capitalized terms not otherwise defined herein shall have the
meanings ascribed to them in the Registration Statement.
We have acted as special Maryland corporate counsel for the Company in
connection with the matters described herein. In our capacity as special
Maryland corporate counsel to the Company, we have reviewed and are familiar
with proceedings proposed to be taken by the Company in connection with the
authorization, issuance and sale of the Shares, and for purposes of this opinion
have assumed such proceedings will be timely completed in the manner presently
proposed. In addition, we have relied upon certificates and advice from the
officers of the Company upon which we believe we are justified in relying and on
various certificates from, and documents recorded with, the State Department of
Assessments and Taxation of Maryland (the "SDAT"), including the charter of the
Company (the "Charter"), consisting of Articles of Restatement filed with the
SDAT on April 27, 1992 and Articles Supplementary filed with the SDAT on
September 26, 1997 and September 3, 1998. We have also examined the Bylaws of
the Company, as amended through the date hereof (the "Bylaws") and Resolutions
of the Board of Directors of the Company and committees thereof adopted on or
before the date hereof and in full force and effect on the date hereof; and such
laws, records, documents, certificates, opinions and instruments as we deem
necessary to render this opinion.
<PAGE>
Health Care Property Investors, Inc.
September 4, 1998
Page 2
We have assumed the genuineness of all signatures, the authenticity of all
documents submitted to us as originals and the conformity to the originals of
all documents submitted to us as certified, photostatic or conformed copies. In
addition, we have assumed that each person executing any instrument, document or
certificate referred to herein on behalf of any party is duly authorized to do
so. We have also assumed that none of the Shares will be issued or transferred
in violation of the restrictions on ownership and transfer of stock contained in
the Charter of the Company and described in the Prospectus Supplement (which is
part of the Registration Statement) under "Restrictions on Ownership and
Transfer".
Based on the foregoing, and subject to the assumptions and qualifications set
forth herein, it is our opinion that, as of the date of this letter, the Shares
have been duly authorized by all necessary corporate action on the part of the
Company, and the Shares will, upon issuance and delivery in accordance with the
terms and conditions described in the Registration Statement against payment of
the purchase price thereof as determined by the Board of Directors of the
Company or a committee thereof, be validly issued, fully paid and nonassessable.
We consent to your filing this opinion as an exhibit to the Registration
Statement, and further consent to the filing of this opinion as an exhibit to
the applications to securities commissioners for the various states of the
United States for registration of the Shares. We also consent to the
identification of our firm as Maryland counsel to the Company in the section of
the Prospectus (which is part of the Registration Statement) entitled "Legal
Matters."
The opinions expressed herein are limited to the laws of the State of Maryland
and we express no opinion concerning any laws other than the laws of the State
of Maryland. Furthermore, the opinions presented in this letter are limited to
the matters specifically set forth herein and no other opinion shall be inferred
beyond the matters expressly stated.
Very truly yours,
/s/ Ballard Spahr Andrews & Ingersoll, LLP
<PAGE>
EXHIBIT 8.1
[Letterhead of Latham & Watkins]
August 27, 1998
Health Care Property Investors, Inc.
4675 MacArthur Court, 9th Floor
Newport Beach, California 92660
Re: Health Care Property Investors, Inc.
$150,000,000 Medium-Term Notes, Series D
----------------------------------------
Ladies and Gentlemen:
We have acted as special counsel to Health Care Property Investors, Inc., a
Maryland corporation (the "Company"), in connection with the registration under
the Securities Act of 1933 (the "1933 Act") and the issuance of up to an
aggregate initial offering price of $150,000,000 Medium-Term Notes, Series D,
due nine months or more from date of issue, having such terms and provisions as
set forth in a certificate of certain officers of the Company dated August 27,
1998 delivered pursuant to Section 301 of the indenture dated as of September 1,
1993 (the "Indenture") between the Company and The Bank of New York, as trustee
(the "Notes"), pursuant to (i) a registration statement on Form S-3 under the
1933 Act, filed with the Securities and Exchange Commission (the "Commission")
on June 18, 1998 (File No. 333-57163) and declared effective by the Commission
on June 30, 1998 (the "Registration Statement"), (ii) a Prospectus dated August
27, 1998 (the "Base Prospectus"), as supplemented by the Prospectus Supplement
dated August 27, 1998, filed with the Commission on August 27, 1998 pursuant to
Rule 424(b) under the 1933 Act (the "Prospectus Supplement," and together with
the Base Prospectus, the "Prospectus"), and (iii) the distribution agreement
dated as of August 27, 1998 among Merrill Lynch & Co., Merrill Lynch, Pierce,
Fenner & Smith Incorporated, Goldman, Sachs & Co., NationsBanc Montgomery
Securities LLC, BNY Capital Markets, Inc. and the Company (the "Distribution
Agreement").
This opinion is based on various assumptions and is conditioned upon certain
representations made by the Company as to factual matters through a certificate
of an officer of the Company (the "Officer's Certificate") and certain facts set
forth in the Prospectus.
In our capacity as such counsel, we have made such legal and factual
examinations and inquiries, including an examination of originals or copies
certified or otherwise identified to our satisfaction of such documents,
corporate records and other
<PAGE>
Health Care Property Investors, Inc.
August 27, 1998
Page 2
instruments, as we have deemed necessary or appropriate for purposes of this
opinion. In our examination, we have assumed the authenticity of all documents
submitted to us as originals, the genuineness of all signatures thereon, the
legal capacity of natural persons executing such documents and the conformity to
authentic original documents of all documents submitted to us as copies.
We are opining herein as to the effect on the subject transaction only of the
federal income tax laws of the United States and we express no opinion with
respect to the applicability thereto, or the effect thereon, of other federal
laws, the laws of any state or other jurisdiction or as to any matters of
municipal law or the laws of any other local agencies with any state.
Based upon the facts set forth in the Prospectus and Officer's Certificate, it
is our opinion that the information in the Prospectus Supplement set forth under
the caption "Material Federal Income Tax Considerations," to the extent that it
constitutes matters of law, summaries of legal matters, documents or
proceedings, or legal conclusions, has been reviewed by us and is correct in all
material respects.
No opinion is expressed as to any matter not discussed herein.
This opinion is rendered to you as of the date of this letter, and we
undertake no obligation to update this opinion subsequent to the date hereof.
This opinion is based on various statutory provisions, regulations promulgated
thereunder and interpretations thereof by the Internal Revenue Service and the
courts having jurisdiction over such matters, all of which are subject to change
either prospectively or retroactively. Also, any variation or difference in the
facts from those set forth in the Prospectus or Officer's Certificate may affect
the conclusions stated herein.
This opinion is rendered only to you and is solely for your benefit in
connection with the Prospectus. We hereby consent to the filing of this opinion
as an exhibit to the Registration Statement. This opinion may not be relied
upon by you for any other purpose, or furnished to, quoted to or relied upon by
any other person, firm or corporation for any purpose, without our prior written
consent.
Very truly yours,
/s/ Latham & Watkins
<PAGE>
EXHIBIT 8.2
[Letterhead of Latham & Watkins]
September 4, 1998
Health Care Property Investors, Inc.
4675 MacArthur Court, 9th Floor
Newport Beach, California 92660
Re: Health Care Property Investors, Inc.
8.70% Series B Cumulative Redeemable Preferred Stock
----------------------------------------------------
Ladies and Gentlemen:
We have acted as special counsel to Health Care Property Investors, Inc., a
Maryland corporation (the "Company"), in connection with the registration under
the Securities Act of 1933, as amended (the "1933 Act"), and the sale to the
Underwriters (as defined below) of 5,385,000 shares of the Company's 8.70%
Series B Cumulative Redeemable Preferred Stock, pursuant to (i) a registration
statement on Form S-3, No. 333-57163, filed with the Securities and Exchange
Commission (the "Commission") on June 18, 1998, as amended and supplemented as
of the date hereof, (ii) a Prospectus dated August 27, 1998, including the
documents incorporated by reference therein (the "Base Prospectus"), as
supplemented by the Prospectus Supplement dated September 1, 1998 and filed with
the Commission on September 2, 1998 pursuant to Rule 424(b) under the 1933 Act
(the "Prospectus Supplement," and together with the Base Prospectus, the
"Prospectus"), (iii) a purchase agreement dated September 1, 1998 among Merrill
Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated, Morgan Stanley
& Co. Incorporated, PaineWebber Incorporated, Prudential Securities
Incorporated, and Salomon Smith Barney Inc., as representatives of the several
underwriters named in Schedule A thereto (collectively, the "Underwriters"), and
the Company (the "Purchase Agreement").
This opinion is based on various assumptions and is conditioned upon certain
representations made by the Company as to factual matters through a certificate
of an officer of the Company (the "Officer's Certificate") and certain facts set
forth in the Prospectus.
In our capacity as such counsel, we have made such legal and factual
examinations and inquiries, including an examination of originals or copies
certified or otherwise identified to our satisfaction of such documents,
corporate records and other instruments, as we have deemed necessary or
appropriate for purposes of this opinion. In our examination, we have assumed
the authenticity of all documents submitted to us as originals, the genuineness
of all signatures thereon, the legal capacity of natural persons executing such
documents and the conformity to authentic original documents of all documents
submitted to us as copies.
<PAGE>
Health Care Property Investors, Inc.
September 4, 1998
Page 2
We are opining herein as to the effect on the subject transaction only of the
federal income tax laws of the United States and we express no opinion with
respect to the applicability thereto, or the effect thereon, of other federal
laws, the laws of any state or other jurisdiction or as to any matters of
municipal law or the laws of any other local agencies with any state.
Based upon the facts set forth in the Prospectus and Officer's Certificate, it
is our opinion that the information in the Prospectus Supplement set forth under
the caption "Certain Federal Income Tax Considerations to Holders of Series B
Preferred Stock," to the extent that it constitutes matters of law, summaries of
legal matters, documents or proceedings, or legal conclusions, has been reviewed
by us and is correct in all material respects.
No opinion is expressed as to any matter not discussed herein.
This opinion is rendered to you as of the date of this letter, and we
undertake no obligation to update this opinion subsequent to the date hereof.
This opinion is based on various statutory provisions, regulations promulgated
thereunder and interpretations thereof by the Internal Revenue Service and the
courts having jurisdiction over such matters, all of which are subject to change
either prospectively or retroactively. Also, any variation or difference in the
facts from those set forth in the Prospectus or Officer's Certificate may affect
the conclusions stated herein.
This opinion is rendered only to you and is solely for your benefit in
connection with the Prospectus. We hereby consent to the filing of this opinion
as an exhibit to the Registration Statement. This opinion may not be relied
upon by you for any other purpose, or furnished to, quoted to or relied upon by
any other person, firm or corporation for any purpose, without our prior written
consent.
Very truly yours,
/s/ Latham & Watkins
