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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities and Exchange Act of 1934
(Amendment No. 2)*
Brandywine Realty Trust REIT
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(Name of Issuer)
Shares of Beneficial Interest
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(Title of Class of Securities)
105368-10-4
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(CUSIP Number)
Marc C. Krantz, Kohrman Jackson & Krantz P.L.L.,
1375 East 9th Street, Cleveland, Ohio 44114, 216-736-7204
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(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications)
June 21, 1996
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(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(b)(3) or (4), check the following box [ ].
Check the following box if a fee is being paid with the statement [ ]. (A fee
is not required only if the reporting person: (1) has a previous statement on
file reporting beneficial ownership of more than five percent of the class of
securities described in Item 1; and (2) has filed no amendment subsequent
thereto reporting beneficial ownership of five percent or less of such
class.)(See Rule 13d-7.)
Note: Six copies of this statement, including all exhibits, should be filed
with the Commission. See Rule 13d-1(a) for other parties to whom copies are to
be sent.
*The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities,
and for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be
deemed to be "filed" for the purpose of Section 18 of the Securities Exchange
Act of 1934 ("Act") or otherwise subject to the liabilities of that section of
the Act but shall be subject to all other provisions of the Act (however, see
the Notes).
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<TABLE>
SCHEDULE 13D
CUSIP NO. 105368-10-4
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1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Richard M. Osborne Trust
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [x]
(b) [ ]
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3 SEC USE ONLY
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4 SOURCE OF FUNDS*
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) or 2(e) [ ]
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
Ohio
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NUMBER OF 7 SOLE VOTING POWER
SHARES 538,800
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BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY
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EACH 9 SOLE DISPOSITIVE POWER
REPORTING 538,800
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PERSON 10 SHARED DISPOSITIVE POWER
WITH
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
538,800
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*[ ]
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
27.3%**
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14 TYPE OF REPORTING PERSON*
00
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**Includes 59,949 Shares and a warrant to purchase 59,949 Shares acquired by
Turkey Vulture Fund XIII, Ltd.
</TABLE>
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<TABLE>
SCHEDULE 13D
CUSIP NO. 105368-10-4
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1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Turkey Vulture Fund XIII, Ltd.
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [x]
(b) [ ]
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3 SEC USE ONLY
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4 SOURCE OF FUNDS*
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) or 2(e) [ ]
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
Ohio
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NUMBER OF 7 SOLE VOTING POWER
SHARES 119,898**
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BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY
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EACH 9 SOLE DISPOSITIVE POWER
REPORTING 119,898**
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PERSON 10 SHARED DISPOSITIVE POWER
WITH
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
119,898**
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*[ ]
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
6.1%**
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14 TYPE OF REPORTING PERSON*
00
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**Includes 59,949 Shares and a warrant to purchase 59,949 Shares acquired by
Turkey Vulture Fund XIII, Ltd.
</TABLE>
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CUSIP No. 105368-10-4
Pursuant to Rule 13d-1(f)(1), this Amendment No. 2 to Schedule 13D
Statement is filed jointly on behalf of the Richard M. Osborne Trust (the
"Trust") and the Turkey Vulture Fund XIII, Ltd., an Ohio limited liability
company. Capitalized terms not otherwise defined herein have the meanings
assigned to them in the Schedule 13D Statement filed by the Trust on January
29, 1996.
Item 2. Identity and Background.
Item 2 is amended and supplemented as follows:
(a) Turkey Vulture Fund XIII, Ltd. (the "Fund") is an Ohio limited
liability company. Richard M. Osborne is the sole manager of the Fund.
(b) The business address of the Fund is 7001 Center Street, Mentor, Ohio
44060.
(c) The principal business of the Fund is to acquire, hold, sell or
otherwise invest in all types of securities and other instruments.
(d) Negative with respect to the Fund.
(e) Negative with respect to the Fund.
(f) The Fund is an Ohio limited liability company.
Item 3. Source and Amount of Fund or Other Consideration.
Item 3 is amended and supplemented as follows:
The Shares and warrant to purchase Shares reported herein as having been
acquired by the Fund were acquired for the aggregate purchase price of
$338,000. The source of the funds was the working capital of the Fund.
Item 4. Purpose of Transaction.
Item 4 is amended and supplemented as follows:
Reference is hereby made to the Loan and Securities Purchase Agreement by
and between the Fund and Brandywine Realty Trust, a Maryland real estate
investment trust ("Brandywine"), dated June 21, 1996 (the "Purchase Agreement")
and the exhibits thereto. The following summary of the Purchase Agreement and
related documents is qualified by reference to the full text of the Purchase
Agreement and related documents, which are attached as exhibits hereto.
On June 21, 1996, the Fund invested $1.3 million in Brandywine, by loaning
to Brandywine $992,293 and by acquiring from Brandywine 59,949 units at a per
unit price of $5.63. The loan is unsecured and bears interest at the prime
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CUSIP No. 105368-10-4
rate in effect from time to time. Interest is payable quarterly in arrears,
and Brandywine has the right to pay the accrued interest in cash when due or
add the accrued interest to the outstanding principal amount of the loan. Each
unit issued to the Fund includes one Share and one six-year warrant to purchase
an additional Share at $6.50 per Share (subject to customary antidilution
adjustments). Under certain circumstances that may arise if Brandywine issues
additional Shares to any person other than to the Fund, the Trust, Mr. Osborne
or his affiliates, Brandywine is obligated to issue additional units, at $5.63
each, to the Fund as a mandatory prepayment of the Fund's loan. The loan
matures on June 21, 1999. The Fund made its investment in Brandywine for the
purposes of investment.
Under the terms of the Purchase Agreement, the Fund agreed to be bound by
all of the provisions of that certain agreement, dated March 20, 1996, by and
among Brandywine, Mr. Osborne and the Trust which is described in, and attached
to, the Amendment No. 1 to Schedule 13D Statement filed by the Trust on March
27, 1996.
Brandywine has agreed to provide the Fund and the Trust with registration
rights covering the Shares issued and issuable as part of the Fund's
investment. The registration rights agreement (the "Registration Rights
Agreement") will be entered into by the Fund, Brandywine, Safeguard Securities,
Inc. ("SSI") and The Nichols Company ("TNC") at the time of the closing of the
proposed transaction between Brandywine, SSI, TNC and certain others (the
"SSI/TNC Transaction"). If the SSI/TNC Transaction is not consummated,
Brandywine will provide registration rights to the Fund on substantially
similar terms to those that would have been provided in the form of
Registration Rights Agreement attached as Exhibit 7.8 hereto.
The Registration Rights Agreement will provide that, at the request of
certain holders of registrable securities, including the Fund ("Registrable
Securities"), Brandywine will, at its expense, register up to two underwritten
distributions of Shares and provide for an annual shelf registration of such
Shares for sale at the market through brokers' transactions and thereafter with
market makers; provided, however, that Brandywine will not be obligated to pay
the expenses of an underwritten offering during the first 12 months after the
closing date of the SSI/TNC Transaction. The holders of Registrable Securities
will also be entitled to "piggyback" on the registrations of Shares. In
connection with the registrations, Brandywine and the selling shareholders will
mutually indemnify each other against certain liabilities, including
liabilities under the federal securities laws.
Item 5. Interest in Securities of the Issuer.
(a) According to the most recently available filing with the Securities
and Exchange Commission by Brandywine, there are 1,856,200 Shares outstanding.
The Fund beneficially owns 119,898 Shares, which is the sum of the 59,949
Shares and the warrant to purchase 59,949 Shares issued by Brandywine to the
Fund on June 21, 1996. The 119,898 Shares beneficially owned by the Fund
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CUSIP No. 105368-10-4
represent approximately 6.1% of the sum of the Shares reported to be
outstanding by Brandywine and the Shares and warrant issued on June 21, 1996.As
sole manager of the Fund and as sole trustee of the Trust, Mr. Osborne may be
deemed to beneficially own the Shares beneficially owned by the Fund and the
538,800 Shares previously reported as being owned by the Trust for a total of
658,698 Shares, or approximately 33.3% of the sum of the Shares reported to be
outstanding by Brandywine and the Shares and warrant issued on June 21, 1996.
(b) Mr. Osborne, as sole manager of the Fund, has sole power to vote, or
to direct the voting of, and the sole power to dispose or to direct the
disposition of, the Shares owned by the Fund.
(c) The transaction described in Item 3 hereof pursuant to which the
Fund acquired the 59,949 Shares and the warrant to purchase 59,949 Shares is
the only transaction by the Fund in the Shares that was effected during the
past 60 days.
Item 7. Material to be Filed as Exhibits.
Exhibit 7.5 -- Loan and Securities Purchase Agreement, dated June 21,
1996, by and between Turkey Vulture Fund XIII, Ltd.
and Brandywine Realty Trust
Exhibit 7.6 -- Promissory Note, dated June 21, 1996, issued by
Brandywine Realty Trust to Turkey Vulture Fund XIII,
Ltd.
Exhibit 7.7 -- Warrant Agreement for the Purchase of Shares of Common
Stock, dated June 21, 1996, issued by Brandywine
Realty Trust to Turkey Vulture Fund XIII, Ltd.
Exhibit 7.8 -- Form of Registration Rights Agreement (Exhibit D to
Purchase Agreement)
Exhibit 7.9 -- Agreement of Joint Filing
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CUSIP No. 105368-10-4
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
Dated: June 24, 1996 THE RICHARD M. OSBORNE TRUST
By: /s/ Richard M. Osborne
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Richard M. Osborne, Trustee
TURKEY VULTURE FUND XIII, LTD.
By: /s/ Richard M. Osborne
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Richard M. Osborne, Manager
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Exhibit Index
Exhibit 7.5 -- Loan and Securities Purchase Agreement, dated June 21,
1996, by and between Turkey Vulture Fund XIII, Ltd.
and Brandywine Realty Trust
Exhibit 7.6 -- Promissory Note, dated June 21, 1996, issued by
Brandywine Realty Trust to Turkey Vulture Fund XIII,
Ltd.
Exhibit 7.7 -- Warrant Agreement for the Purchase of Shares of Common
Stock, dated June 21, 1996, issued by Brandywine
Realty Trust to Turkey Vulture Fund XIII, Ltd.
Exhibit 7.8 -- Form of Registration Rights Agreement (Exhibit D to
Purchase Agreement)
Exhibit 7.9 -- Agreement of Joint Filing
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Exhibit 7.5
THE SECURITIES OFFERED AND SOLD PURSUANT TO THIS AGREEMENT HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE "SECURITIES ACT") OR THE
SECURITIES LAWS OF ANY STATE, AND THERE ARE RESTRICTIONS ON THE TRANSFERABILITY
OF THE SECURITIES AS DESCRIBED HEREIN.
LOAN AND SECURITIES PURCHASE AGREEMENT
THIS LOAN AND SECURITIES PURCHASE AGREEMENT (this "Agreement") is
made and entered into this 21st day of June, 1996, by and between TURKEY
VULTURE FUND XIII, LTD., having an address at 7001 Center Street, Mentor, Ohio
44060 (the "Fund"), and BRANDYWINE REALTY TRUST, having an address at Two
Greentree Centre, Suite 100, Marlton, New Jersey 08053 (the "Company").
RECITALS
A. The Richard M. Osborne Trust (the "RMO Trust"), an affiliate of
the Fund, owns beneficially, 538,800 common shares of beneficial interest of
the Company, par value $0.01 per share ("Common Stock").
B. To raise working capital and to conduct its business, the
Company desires to (i) sell to the Fund, and the Fund desires to purchase from
the Company, Fifty Nine Thousand Nine Hundred Forty Nine (59,949) units (each,
a "Unit") comprised of one share of Common Stock and one warrant to purchase an
additional share of Common Stock at an initial exercise price of $6.50 per
share, and (ii) borrow from the Fund, and the Fund desires to lend to the
Company, the principal amount of Nine Hundred Ninety Two Thousand Two Hundred
and Ninety Three Dollars ($992,293).
In consideration of the premises and the mutual covenants herein
contained and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto hereby agree
as follows:
1. AGREEMENT TO PURCHASE
1.1. Sale of Units. Subject to and in accordance with the terms of this
Agreement, the Fund hereby purchases from the Company Fifty Nine Thousand Nine
Hundred Forty Nine (59,949) Units, and the Company hereby sells and issues such
Units to the Fund, free and clear of any liens, charges, claims, and
encumbrances whatsoever.
1.2. Purchase Price for Units. The purchase price for each Unit is Five
Dollars and sixty three cents ($5.63), amounting to an aggregate purchase price
for the Units of Three Hundred Thirty Seven Thousand Five Hundred Thirteen
Dollars ($337,513) (the "Purchase Price"), for an aggregate 59,949 shares of
Common Stock (the "Shares") and warrants to purchase an additional 59,949
shares of Common Stock. The Fund has delivered contemporaneously with the
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execution and delivery of this Agreement a check or wire transfer payable to
the Company in the amount of the Purchase Price.
1.3. Delivery of Units. The Company has delivered to the Fund
contemporaneously with the execution and delivery of this Agreement (i) a stock
certificate representing the Shares and (ii) a Stock Purchase Warrant in
substantially the form attached hereto as Exhibit A (the "Warrant") evidencing
the warrants being purchased and sold hereunder, both of the foregoing duly
executed and registered in the name of the Turkey Vulture Fund XIII, Ltd.
2. THE LOAN
2.1. Loan. Subject to and in accordance with the terms of this
Agreement, the Fund hereby lends to the Company Nine Hundred Ninety Two
Thousand Two Hundred Ninety Three Dollars ($992,293) (the "Loan"). The Fund
has delivered contemporaneously with this Agreement a check or wire transfer
payable to the Company for the entire principal amount of the Loan.
2.2. Delivery of Note. The Company has delivered to the Fund
contemporaneously with the execution and delivery of this Agreement a duly
executed promissory note of the Company (the "Note"), in substantially the form
attached hereto as Exhibit B, evidencing the Loan and setting forth the terms
and conditions pursuant to which the Loan shall be repaid to the Fund.
3. REPRESENTATIONS, WARRANTIES AND COVENANTS
3.1. Representations, Warranties and Covenants of the Fund. By executing
this Agreement, the Fund hereby:
3.1.1. Represents and warrants that it maintains its corporate
headquarters and principal place of business at the address set forth above.
3.1.2. Acknowledges that it has received a copy of the Company's SEC
Reports (as defined below).
3.1.3. Represents and warrants that the Units being purchased and
sold hereunder, the Note, and the Units that may be issued to the Fund
thereunder (all of the foregoing, including shares of Common Stock that
comprise part of the Units and shares of Common Stock issuable upon exercise of
the warrants included therein, collectively, the "Securities") are being
acquired for the Fund's own account, without a view to public distribution or
resale and that the Fund has no contract, undertaking, agreement or arrangement
to sell or otherwise transfer or dispose of any Securities or any portion
thereof to any other person.
3.1.4. Understands that the Securities have not been registered
under the Securities Act of 1933, as amended (the "Securities Act") or the
securities laws of any state, and, as a result thereof, the Securities are
subject to substantial restrictions on transfer.
3.1.5. Agrees that it will not sell or otherwise transfer or dispose
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of any Securities or any portion thereof except in accordance with the
Securities Act and any applicable state securities laws, and that the
Securities and certificates evidencing the same will bear a legend reflecting
such restrictions.
3.1.6. Represents and warrants that in determining to purchase the
Securities, it has, during the course of discussions concerning the purchase of
the Securities, been offered the opportunity to ask such questions and inspect
such documents concerning the Company and its business and affairs as it has
requested so as to more fully understand the nature of the investment and to
verify the accuracy of the information supplied.
3.1.7. ACKNOWLEDGES THAT THE PURCHASE OF THE SECURITIES INVOLVES A
HIGH DEGREE OF RISK, AND REPRESENTS AND WARRANTS THAT IT CAN BEAR THE ECONOMIC
RISK OF THE PURCHASE OF THE SECURITIES, INCLUDING THE TOTAL LOSS OF ITS
INVESTMENT.
3.1.8. Represents and warrants that (i) it has adequate means of
providing for its current needs and financial contingencies, (ii) it has no
need for liquidity in this investment, and (iii) the Fund was not formed for
the specific purpose of making an investment in the Securities.
3.1.9. Understands that no federal or state agency has approved or
disapproved the Securities, passed upon or endorsed the merits of the offering
of the Securities hereunder, or made any finding or determination as to the
fairness of the Securities for investment.
3.1.10. Understands that the Securities are being offered and sold
in reliance on specific exemptions from the registration requirements of
federal and state securities laws and that the Company is relying upon the
truth and accuracy of the representations, warranties, agreements,
acknowledgments and understandings set forth herein in order to determine the
applicability of such exemption and the suitability of the Fund to acquire the
Securities.
3.1.11. Represents and warrants that it is an "accredited investor"
as such term is defined in Rule 501 of Regulation D under the Securities Act.
3.2. Representations, Warranties and Covenants of the Company. By
executing this Agreement, the Company hereby represents, warrants and covenants
that:
3.2.1. The Company is a real estate investment trust duly formed,
validly existing and in good standing under the laws of the State of Maryland
and has all requisite trust power and authority, and all necessary licenses and
permits, to own and lease its properties and assets and to conduct its business
as now conducted. The Company is duly qualified to do business and is in good
standing as a foreign business trust in each jurisdiction where the character
of its properties or assets and the nature of its business requires it to be so
qualified.
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3.2.2. The Company has all requisite trust power and authority to
execute and deliver this Agreement and each other document, including without
limitation, the Warrant, the Note and the Securities which may be issued
pursuant to the terms of the Note (all of the foregoing, collectively, the
"Transaction Documents") required to be executed and delivered by it in
accordance with the terms hereof, and to carry out the transactions
contemplated hereby and thereby. The execution, delivery and performance by
the Company of this Agreement and each Transaction Document to which it is a
party have been duly authorized by all requisite action. This Agreement has
been duly executed and delivered by the Company and, constitutes (and, when
executed and delivered as contemplated herein each such Transaction Document
will constitute) the legal, valid and binding obligation of the Company,
enforceable against the Company in accordance with their respective terms,
except as such enforcement may be limited by bankruptcy, insolvency,
moratorium, reorganization and other similar laws relating to or affecting the
enforcement of creditors' rights generally, and except that the availability of
specific performance, injunctive relief or other equitable remedies is subject
to the discretion of the court before which any such proceeding may be brought.
3.2.3. The execution, delivery and performance by the Company of
this Agreement and each Transaction Document to which it is a party will not,
with or without the giving of notice or lapse of time or both, violate any
provision of law, any rule or regulation of any governmental authority, or any
judgment, decree or order of any court binding on the Company and, will not
conflict with or result in any breach of any of the terms, conditions or
provisions of, or constitute a default under, or result in the creation of any
lien, security interest, charge or encumbrance upon any of the properties,
assets or outstanding stock of the Company under its Declaration of Trust or
By-Laws, or any indenture, mortgage, lease, agreement or other instrument to
which the Company is a party or by which it or any of its assets or properties
is bound.
3.2.4. The authorized capital stock of the Company presently
consists of: (a) 15,000,000 shares of Common Stock, 1,856,200 shares of which
are presently issued and outstanding, and (b) 5,000,000 preferred shares of
beneficial interest, par value $0.01 per share, none of which is presently
issued and outstanding. All issued and outstanding shares of Common Stock have
been duly and validly issued and are fully paid and nonassessable. Except as
otherwise set forth in the SEC Reports (as defined below), and except to the
extent contemplated by the Letter of Intent dated March 20, 1996 among the
Company, Safeguard Scientifics, Inc., and The Nichols Company, a copy of which
the Fund acknowledges receiving, there are no outstanding subscriptions,
warrants, options or other rights to subscribe for or purchase from the
Company, or obligating the Company to issue, any shares of capital stock of the
Company or any securities convertible into or exchangeable for such shares, and
there are no shares of Common Stock reserved for issuance. There are no
preemptive or similar rights to purchase or otherwise acquire shares of capital
stock of the Company pursuant to any provision of law or the Declaration of
Trust or By-Laws of the Company or by agreement or otherwise.
3.2.5. The requisite number of duly authorized and unissued shares
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of Common Stock of the Company have been duly authorized and reserved for
issuance upon exercise of the Warrant (the "Warrant Shares"), and except as
provided in Section 5.1 hereof, no further action is required for the valid
issuance of shares of Common Stock upon exercise of the Warrant. Upon the
issuance of any Units pursuant to the terms of the Note (the "Additional
Units"), (a) the requisite number of shares of Common Stock will be duly
authorized and issued (the "Additional Shares"), (b) a stock certificate
representing such shares will be delivered to the Fund contemporaneously with
the issuance of the Additional Units, (c) the requisite number of duly
authorized and unissued shares of Common Stock will be duly authorized and
reserved for issuance upon exercise of the warrants issued thereby (the
"Additional Warrant Shares" and together with the Warrant Shares, collectively,
the "Conversion Shares"), (d) a warrant for the Additional Warrant Shares in
substantially the form of the Warrant (the "Additional Warrant") will be
delivered to the Fund contemporaneously with the issuance of Additional Units,
and, except as provided in Section 5.1 hereof, no further action will
thereafter be required for the valid issuance of shares of Common Stock upon
exercise of such warrants. The Shares have been duly and validly issued, are
fully paid and nonassessable and are free and clear of any liens, charges,
claims and encumbrances whatsoever and are not subject to any preemptive
rights. The Additional Shares will when issued in accordance with the terms of
the Loan be duly and validly issued, fully paid and nonassessable and will be
issued free and clear of any liens, charges, claims and encumbrances whatsoever
and not subject to any preemptive rights. The Warrant Shares will, when issued
against payment therefor in accordance with the terms of the Warrant, be duly
and validly issued, fully paid and nonassessable and will be issued free and
clear of any liens, charges, claims and encumbrances whatsoever and not subject
to any preemptive rights. The Additional Warrant Shares will, on the date(s)
of the issuance of Additional Units pursuant to the terms of the Note and
thereafter, when issued against payment therefor in accordance with the terms
of such warrants, be duly and validly issued, fully paid and nonassessable and
will be issued free and clear of any liens, charges, claims and encumbrances
whatsoever and not subject to any preemptive rights.
3.2.6. No permit, consent, approval or authorization of, or
declaration to or filing with, any federal, state, local or foreign
governmental or regulatory authority or other person or entity is required in
connection with the execution or delivery of this Agreement or any Transaction
Document by the Company, the offer, issuance, sale or delivery of the
Securities, including without limitation, the Note, the Shares, the Warrant,
the Additional Units, the Additional Shares, the Additional Warrant, or the
Conversion Shares, or the carrying out by the Company of the other transactions
contemplated hereby, other than (a) the filing with, and approval of, the
American Stock Exchange, Inc. ("ASE") with respect to the listing of the Common
Stock and (b) filings under federal and applicable state securities laws.
3.2.7. Assuming the accuracy of the Fund's representations and
warranties contained in Section 3.1 hereof, the offer, issuance and delivery to
the Fund pursuant to the terms of this Agreement of the Note, the Shares and
the Warrant and, assuming compliance by the Fund with the terms of this
Agreement and applicable law, the Additional Units, the Additional Shares, the
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Additional Warrant and the Conversion Shares, are exempt from registration
under the Securities Act.
3.2.8. Since January 1, 1995, the Company has timely filed all
forms, reports, schedules, statements and other documents required to be filed
with the Securities and Exchange Commission (the "SEC") pursuant to the
Securities Exchange Act of 1934, as amended (the "Exchange Act") (collectively,
the "SEC Reports"). The SEC Reports were prepared in all material respects in
accordance with and complied in all material respects with the requirements of
applicable law, including the Exchange Act and the Securities Act and the
applicable rules and regulations of the SEC thereunder, and the SEC Reports did
not at the time they were filed, and do 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 statements therein, in the light of the
circumstances under which they were made, not misleading.
3.2.9. The Company shall execute a registration rights agreement
substantially in the form attached hereto as Exhibit D concurrently upon the
closing of the Company's proposed transaction with Safeguard Scientifics, Inc.
("SSI"), The Nichols Company ("TNC") and certain of its affiliates as such
transaction is more particularly described in the Company's Preliminary Proxy
Statement first filed with the SEC on or about May 9, 1996 (the "SSI/TNC
Transaction"); provided that in the event the SSI/TNC Transaction is not
consummated on or prior to October 31, 1996, the Company shall execute a
registration rights agreement in favor of the Fund substantially in the form
attached hereto as Exhibit D with the applicable references to SSI and TNC
deleted.
3.2.10. The Company has complied with all laws (including, without
limitation, the Americans with Disabilities Act of 1990) and requirements of
insurance bodies applicable to the ownership, leasing, use and operation of its
properties and has obtained and fully paid for all licenses, permits,
certificates, entitlements, grants of right and any other items and documents
required by applicable law to be obtained by the Company for the completion,
ownership, leasing, use and occupancy of its properties, except where the
failure to so comply or obtain would not have a material adverse effect on the
Company. Such licenses, permits, certificates, entitlement, grants of right
and other items and documents are in full force and effect. The Company has
not taken any action that would (or failed to take any action, the omission of
which would) result in the revocation or suspension of such licenses, permits,
certificates, entitlements, grants of right and other items and documents, and
the Company has not received any notice of any violation from any federal,
state or municipal entity or notice of an intention by any such governmental
entity to revoke any certificate of occupancy or other certificate, license,
permit, entitlement or grant of right issued by it in connection with the
ownership, use and occupancy of any of its properties that in each case has not
been cured or otherwise resolved to the satisfaction of such governmental
entity.
3.2.11. There are no claims, actions, suits, proceedings or
investigations pending or, to the best of the Company's knowledge, threatened
<PAGE>
<PAGE> 7
before any court, governmental unit or any mediator or arbitrator with respect
to the Company or its properties, except for litigation arising in the ordinary
course of business, which litigation, individually or in the aggregate, would
not have a material adverse effect upon the Company or its properties.
3.2.12. Each of the financial statements (including, in each case,
any related notes thereto) contained in the SEC Reports (i) have been prepared
in all material respects in accordance with the published rules and regulations
of the SEC and generally accepted accounting principles applied on a consistent
basis throughout the periods involved (except in the case of the unaudited
financial statements, as permitted by Form 10-Q of the SEC), (ii) comply as to
form in all material respects with applicable accounting requirements and the
published rules and regulations of the SEC with respect thereto, and (iii)
fairly present in all material respects the financial position of the Company
as of the respective dates thereof and the results of operations and cash flows
for the periods indicated (subject, in the case of unaudited financial
statements for interim periods, to year-end adjustments, consisting only of
normal recurring accruals), except that any pro forma financial statements
contained in such financial statements are not necessarily indicative of the
financial position of the Company as of the respective dates thereof and the
results of operations and cash flows for the periods indicated. Since January
1, 1994, the Company has not made any material change in the accounting
practices or policies applied in the preparation of its financial statements.
4. CONDITIONS TO CLOSING BY FUND
The obligation of the Fund to purchase the Units and make the Loan is
subject to the fulfillment, to the Fund's reasonable satisfaction, of each of
the following conditions:
4.1. Performance. All covenants, agreements and conditions contained in
this Agreement and each of the Transaction Documents to be performed or
complied with by the Company on or prior to the date hereof shall have been
performed or complied with by the Company in all respects.
4.2. Legal Opinion. The Company shall have delivered to the Fund an
opinion of Pepper, Hamilton & Scheetz, counsel to the Company, dated the date
hereof, addressed to the Fund and in the form attached hereto as Exhibit C.
4.3. Qualifications. On the date hereof, all authorizations, approvals
or permits of, or filings with, any governmental authority, including state
securities or blue sky offices that are required prior to the date hereof in
connection with the issuance of the Securities to be issued to the Fund on the
date hereof shall have been duly obtained and shall be effective on and as of
the date hereof.
4.4. Secretary's Certificate. The Company shall have delivered to the
Fund copies of each of the following, certified as accurate, true and complete
copies thereof as of the date hereof by the Company's Secretary:
(a) resolutions of the Board of Trustees of the Company,
<PAGE>
<PAGE> 8
authorizing and approving this Agreement, the Transaction Documents and all
transactions contemplated hereby and thereby; and
(b) the signature(s) and incumbency of the officer(s) of the
Company authorized to execute and deliver the Transaction Documents.
4.5. Good Standing Certificate. The Company shall have delivered to the
Fund a good standing certificate, dated not more than ten (10) days prior to
the date hereof, relating to the Company from the Secretary of State of the
State of Maryland and for each State in which the Company is qualified to do
business as a foreign business trust.
4.6. Additional Documents. The Fund shall have received such other
documents, instruments, approvals or opinions as the Fund shall have reasonably
requested.
4.7. Legal Fees. The Company shall have paid the reasonable fees and
expenses of the Fund's counsel only to the extent incurred in connection with
the negotiation, execution and delivery of this Agreement, the other
Transaction Documents and the consummation of the transactions contemplated
herein and therein.
5. MISCELLANEOUS PROVISIONS
5.1. In no event shall the Company be obligated to issue any shares of
Common Stock upon exercise of any warrants or to deliver any Units hereunder or
under the Note in the event such issuance or delivery would contravene the
provisions of Section 3.3(a) of the Company's Declaration of Trust.
5.2. No recourse shall be had for any obligation of the Company
hereunder, or for any claim based thereon or otherwise in respect thereof,
against any past, present or future trustee, shareholder, officer or employee
of the Company, whether by virtue of any statute or rule of law, or by the
enforcement of any assessment or penalty or otherwise, all such other liability
being expressly waived and released by the Fund.
5.3. This Agreement shall be binding upon and shall inure to the benefit
of the parties hereto and their respective heirs, personal representatives,
successors and assigns.
5.4. This Agreement and the other Transaction Documents, together with
the exhibits hereto, and thereto, sets forth the entire understanding and
agreement between the parties hereto with respect to the subject matter hereof,
and supersedes any and all prior and contemporaneous agreements, inducements,
covenants, conditions, representations and warranties, oral or written,
expressed or implied, except as contained herein. This Agreement may be
modified only by a written document signed by each of the parties hereto.Except
as set forth in Section 5.14 hereof, nothing herein shall modify, amend or
limit in any way that certain Agreement dated as of March 20, 1996, by and
among the Company, the RMO Trust and Richard M. Osborne (the "March
Agreement"), or the terms and conditions thereof.
<PAGE>
<PAGE> 9
5.5. In the event that for any reason any provision of this Agreement
shall be deemed to be invalid, illegal or unenforceable, the validity, legality
and enforceability of the remaining provisions shall not in any way be affected
or impaired thereby. In furtherance and not in limitation of the foregoing, in
no event shall any actions be taken pursuant to this Agreement, the Securities
or the Loan (including without limitation, the exercise of the Warrant and/or
the warrants or the issuance of any shares of Common Stock upon such exercise)
to the extent that such action would result, or could (in the view of the
Company and the Fund) reasonably be construed to result, (i) in a violation of
the provisions of Section 3-601 et. seq. of the Maryland General Corporation
Law or (ii) in the Fund owning an interest in the Company that would fall
within, or be greater than, the "control share" range of "one-third or more,
but less than a majority of all voting power" as provided in and contemplated
by the provisions of Section 3-701 et. seq. of the Maryland General Corporation
Law.
5.6. This Agreement shall be governed, construed and enforced in
accordance with the internal laws of the State of Maryland.
5.7. The provisions of this Agreement may be amended only in writing by
mutual agreement of the Company and the Fund.
5.8. All representations and warranties contained herein or made in
writing by any party in connection herewith shall survive the execution and
delivery of this Agreement and the other Transaction Documents, the
consummation of the transactions contemplated hereby and thereby and any
investigation made at any time by or on behalf of the Fund.
5.9. The descriptive headings of this Agreement are inserted for
convenience of reference only and do not constitute a part of this Agreement.
5.10. All notices required to be given to either of the parties hereunder
shall be in writing and shall be deemed to have been sufficiently given for all
purposes when presented personally to such party, sent by overnight courier, or
sent by certified or registered mail, return receipt requested, to such party
at its address set forth in the heading of this Agreement. Such notice shall
be deemed to be given when received if delivered personally, the next day after
the date sent if sent by overnight courier, or three days after the date mailed
if sent by certified or registered mail. Any notice of any change in such
address shall also be given in the manner set forth above. Whenever the giving
of notice is required the giving of such notice may be waived in writing by the
party entitled to receive such notice.
5.11. All exhibits hereto and the other Transaction Documents to be
delivered to the Fund pursuant hereto are an integral part of this Agreement.
5.12. No course of dealing between the Company and the Fund or any delay
in exercising or omission to exercise any right, power or remedy accruing to
the Fund, upon any breach or default of the Company under any of the
Transaction Documents, shall impair any such right, power or remedy of the Fund
or shall be construed to be a waiver of any such breach or default, or an
acquiescence therein, or of or in any similar breach or default thereafter
<PAGE>
<PAGE> 10
occurring; and any waiver of any single breach or default shall not be deemed a
waiver of any other breach or default theretofore or thereafter occurring. Any
waiver, permit, consent or approval of any kind or character on the part of the
Fund of any provisions or conditions of the Transaction Documents must be made
in writing and shall be effective only to the extent specifically set forth in
such writing. All remedies, under the Transaction Documents or otherwise
afforded to the Fund, shall be cumulative and not alternative.
5.13. This Agreement may be executed in any number of counterparts, each
of which when so executed and delivered shall be deemed an original, and such
counterparts together shall constitute one instrument. Each party shall
receive a duplicate original of the counterpart copy or copies executed by it
and the other party.
5.14. The Fund agrees to be bound by all of the provisions of the March
Agreement to the same extent as if it were a named party thereto and included
in the term "Holder."
<PAGE>
<PAGE> 11
IN WITNESS WHEREOF, the parties hereto have executed this Agreement,
intending to be legally bound, this 21st day of June, 1996.
BRANDYWINE REALTY TRUST
By: /s/ Gerard H. Sweeney
----------------------------
Gerard H. Sweeney, President
TURKEY VULTURE FUND XIII, LTD.
By: /s/ Richard M. Osborne
----------------------------
Richard M. Osborne, Trustee
ACKNOWLEDGED THIS 21 DAY
OF JUNE, 1996:
SAFEGUARD SCIENTIFICS, INC.
By: /s/ Gerald M. Wilk
---------------------------
Title: SVP
THE NICHOLS COMPANY
By: /s/ Anthony A. Nichols, Sr.
----------------------------
Title: President
<PAGE>
Exhibit 7.6
THIS PROMISSORY NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933
(THE "ACT") OR UNDER THE SECURITIES LAWS OF ANY STATE, AND MAY NOT BE SOLD,
ASSIGNED OR TRANSFERRED UNLESS EITHER IT IS FIRST REGISTERED UNDER THE ACT AND
ANY APPLICABLE STATE SECURITIES LAWS, OR SUCH SALE, ASSIGNMENT OR TRANSFER IS
MADE PURSUANT TO AN EXEMPTION GRANTED UNDER THE ACT AND ANY SUCH STATE
SECURITIES LAWS.
PROMISSORY NOTE
$992,293 Marlton, New Jersey
June 21, 1996
FOR VALUE RECEIVED, BRANDYWINE REALTY TRUST, a Maryland real estate
investment trust with an office at Two Greentree Centre, Suite 100, Marlton,
New Jersey 08053 ("Maker"), promises to pay to the order of TURKEY VULTURE FUND
XIII, LTD., having an address at 7001 Center Street, Mentor, Ohio 44060
("Payee"), at such office or residence of Payee, or at such other office or
other place as Payee may designate from time to time in writing, the principal
sum of Nine Hundred Ninety Two Thousand Two Hundred Ninety Three Dollars
($992,293), as adjusted as provided in Section 2 below, in lawful money of the
United States of America, together with interest thereon from the date hereof
at the rate hereafter provided, and both payable as hereafter provided. This
Promissory Note is made in connection with the transactions contemplated by
that certain Loan and Securities Purchase Agreement, dated the date hereof, by
and between Maker and the Payee (the "Loan and Securities Purchase
Agreement").Capitalized terms used herein and not otherwise defined herein
shall have the meanings ascribed to them in the Loan and Securities Purchase
Agreement.
1. Interest Rate. The principal sum outstanding from time to time
hereunder shall bear interest at an annual rate equal to the prime rate of
interest as published in The Wall Street Journal from time to time (the "Prime
Rate"). Interest shall be calculated on the basis of the actual number of days
the principal sum is outstanding over a 365 day year.
2. Payments of Principal and Interest. Unless first prepaid in
accordance with the terms of Section 3 hereof, payments of principal plus
interest shall be payable in accordance with the terms set forth in this
Section 2. Principal shall be payable in full on the third (3rd) anniversary
of the date hereof (the "Maturity Date"). Interest shall be payable on the
unpaid principal hereof outstanding from time to time and shall accrue
quarterly in arrears, on the last business day of March, June, September and
December of each year (each, an "Interest Payment Date"), commencing on
September 30, 1996. On an Interest Payment Date, the Maker shall have the
right either to pay the interest accrued during the preceding quarter in cash,
or to have such interest added to the principal amount evidenced hereby, and to
the extent that interest is not paid in cash by the Maker on any particular
Interest Payment Date, such interest shall be added to the principal amount due
<PAGE>
<PAGE> 2
hereunder. If not earlier paid in full, interest shall be payable in full on
the Maturity Date. All amounts payable hereunder shall be paid by the Maker in
lawful money of the United States of America, by check or wire transfer (at
Maker's option), or any other method approved in advance in writing by Payee at
the place set forth in the heading of this Note, or such place as may be
designated by Payee in writing to Maker.
3. Prepayments.
(a) Except as otherwise provided in Sections 3(b) and 3(c)
hereof, the Maker may not prepay this Note.
(b) In the event that (i) any provision of this Note shall
violate a provision of applicable law, or (ii) the amendment to the Maker's
Declaration of Trust intended to eliminate Section 3.3(a) thereof is not
approved at the Maker's next Annual Meeting of Shareholders, and the book value
per share of Common Stock as of the end of any fiscal quarter of the Maker
beginning with the first fiscal quarter of 1996 shall exceed $5.50, then the
Payee, upon five (5) days written notice thereof, may accelerate the payment of
the entire unpaid principal balance hereof, whereupon the Maker shall be
required to prepay, in cash, this Note in its entirety (which shall include
principal and interest accrued thereon). In the event that the Maker, as
determined in accordance with a written opinion of its counsel, is prohibited
from making a prepayment required by the terms of Section 3(c) hereof due to
either (i) or (ii) above, the Maker, upon five (5) days written notice thereof,
may prepay, in cash, this Note in its entirety (which shall include principal
and interest accrued thereon).
(c) (i) In the event the number of outstanding shares of
Maker's capital stock shall increase at any time, or from time to time
following the date of this Note, the Maker shall, as of the next business day
following such increase (each, a "Prepayment Date") (A) calculate (x) in
accordance with the provisions of Section 3-601 et seq. (the "business
combination statute") of the Maryland General Corporation Law, the total market
value of the outstanding stock of the Maker as of such Prepayment Date (the
"Market Value") and (y) an amount equal to 4.9% of the Market Value (the "4.9%
Threshold"), and (B) prepay that portion of the outstanding principal balance
of the Loan (the "Prepayable Portion") by the delivery to the Payee of that
number of Units (the "Prepayable Units"), at $5.63 per Unit, as shall be
calculated by the Maker as follows:
PP = FPNT - (VEI + VOS)
where:
(1) "PP" means the Prepayable Portion. In the event that PP is zero or a
negative number, PP shall be deemed to be equal to zero, and none of
the Loan will be prepaid.
(2) "FPNT" means the 4.9% Threshold.
<PAGE>
<PAGE> 3
(3) "VEI" means the "Value of the Equity Issued." Value of the Equity
Issued shall be calculated by the Maker determining the sum of
(i) the total aggregate number of shares of Common Stock previously
issued by the Maker directly to the Payee, or any Affiliate thereof
(as such term is defined in the business combination statute)
including upon the exercise of warrants issued by the Maker to the
Payee, multiplied by an amount equal to the value of a share of
Common Stock (based on the thirty day period prior to the Prepayment
Date and computed in accordance with the provisions of the business
combination statute), and (ii) the total aggregate number of warrants
previously issued by the Maker directly to the Payee, or any
Affiliate thereof, multiplied by an amount determined by the Board of
Trustees of the Company, in good faith, to be the per warrant value
of such warrants as of the Prepayment Date (excluding the value of
any such warrants previously exercised). To the extent that the
Board of Trustees determines that the warrants included in different
Units have a different value, that factor shall be taken into
consideration in determining the Value of the Equity Issued.
(4) "VOS" means the "Value of Other Issued Securities". Value of Other
Issued Securities shall be calculated by the Maker determining the
total aggregate number of other equity securities (not referred to
above, if any) issued by the Maker to the Payee, or any Affiliate
thereof, on or following the date hereof, multiplied by an amount
determined in accordance with the provisions of the business
combination statute to be the value of such securities as of the
Prepayment Date.
Notwithstanding the foregoing formula, in the event that the formula would
result on any Prepayment Date in the Maker issuing to Payee Prepayable Units
such that the sum of (i) VEI, (ii) VOS, and (iii) value of the Prepayable Units
determined in accordance with the definition of VEI above, exceeds the 4.9%
Threshold, the number of Prepayable Units shall be automatically reduced to the
nearest whole number so that the sum of the foregoing (i), (ii) and (iii) is
less than or equal to the 4.9% Threshold. The Prepayable Portion shall then be
calculated by multiplying such reduced number of Prepayable Units by $5.63. No
fractional Units shall be issued to Payee, and to the extent the foregoing
calculation would require the issuance of a fractional Unit, such portion of
the Loan will not be included in the Prepayable Portion and shall remain part
of the principal outstanding hereunder. All of the foregoing calculations made
by the Maker shall be conclusive absent manifest error.
(ii) In the case of any prepayment pursuant to this Section
3(c), the outstanding principal amount under this Note shall be automatically
reduced by the Prepayable Portion. All Units issued by the Maker upon such
prepayment(s) hereunder shall consist of fully paid and nonassessable shares of
Common Stock, and warrants to purchase Common Stock, all free of liens and
charges and not subject to any preemptive rights.
(d) Except as otherwise provided in Section 3(b) and 4, in no
event shall the Payee have any right to require the Maker to prepay all or any
<PAGE>
<PAGE> 4
portion of the Loan with cash, and except as otherwise provided in Sections
3(c) and 4, in no event shall the Payee have any right to require the Maker to
prepay all or any portion of the Loan with Units.
Any Units, Common Stock or warrants to be issued by the Maker to
Payee under this Section 3 shall be delivered by the Maker to Payee as soon as
practicable, but in no event more than ten (10) business days after each
Prepayment Date.
4. Events of Default; Remedies.
(a) If any of the following events (each is herein referred to
as an "Event of Default") shall occur:
(i) default shall occur in the performance of or
compliance with any covenant contained in Section 3 of the Loan and Securities
Purchase Agreement or Section 3 hereunder, subject in each case to any grace or
cure period set forth herein;
(ii) if any representation or warranty to Payee made by the
Maker in the Loan and Securities Purchase Agreement or in any other Transaction
Document, or in connection with the transactions contemplated hereby or
thereby, shall prove to have been false or inaccurate in any material respect
on the date as of which made;
(iii) all or any part of the principal or interest due
hereunder is not paid when and as the same shall become due and payable,
whether at the maturity thereof, by acceleration, by notice of prepayment or
otherwise and such failure shall continue uncured for 5 days, provided that, an
election by the Maker not to pay interest in cash on an Interest Payment Date
but rather to add such accrued interest to the principal amount due hereunder
shall not be a failure to pay interest due hereunder, and therefore shall not
be an Event of Default hereunder;
(iv) any default in excess of $250,000 shall occur in the
making of the payment of the principal of or interest on any other indebtedness
of the Maker for borrowed money, as and when the same shall become due and
payable by the lapse of time, by acceleration, by call for redemption or
otherwise;
(v) any default or the happening of any event shall occur
under any indenture, agreement or other instrument under which any indebtedness
of the Maker for borrowed money is or may be issued, and such default or event
shall continue for a period of time sufficient to permit the acceleration of
the maturity of any indebtedness of the Maker outstanding thereunder;
(vi) a receiver, conservator, custodian, liquidator or
trustee of the Maker or of all or any of its assets or property is appointed by
court order and such order remains in effect for more than sixty (60) days; or
an order for relief is entered under the federal bankruptcy laws with respect
to the Maker; or any of its material property is sequestered by court order and
<PAGE>
<PAGE> 5
such order remains in effect for more than sixty (60) days; or a petition is
filed against the Maker under the bankruptcy, reorganization, arrangement,
insolvency, readjustment of debt, dissolution or liquidation law of any
jurisdiction, whether now or hereafter in effect, and is not dismissed within
sixty (60) days after such filing;
(vii) the Maker files a petition in voluntary bankruptcy or
seeking relief under any provision of any bankruptcy, reorganization,
arrangement, insolvency, readjustment of debt, dissolution or liquidation law
of any jurisdiction, whether now or hereafter in effect, or consents to the
filing of any petition against it under any such law;
(viii) the Maker makes an assignment for the benefit of its
creditors, or admits in writing its inability to pay, or in fact does not pay,
its debts generally as they become due, or consents to the appointment of a
receiver, conservator, custodian, liquidator or trustee of the Maker, or of all
or any part of its property;
(ix) final judgment for the payment of money in excess of
$250,000 shall be rendered by a court of record against the Maker, and the
Maker shall not (1) discharge the same (by insurance or otherwise) or provide
for its discharge in accordance with its terms, or (2) procure a stay of
execution thereof within sixty (60) days from the date of entry thereof and
within said period of sixty (60) days, or such longer period during which
execution of such judgment shall have been stayed, appeal therefrom and cause
the execution thereof to be stayed during such appeal;
(x) a breach of any material term or material provision of
any of the Warrants or Additional Warrants; or
(xi) the Maker is delisted or otherwise removed from the
American Stock Exchange and is not on the same or next business day listed on
any national securities exchange or the Nasdaq Market; then, when any Event of
Default described in clause (ii), (iv), (v) or (ix) of this Section 4(a) has
occurred and shall be continuing, this Note shall, upon written notice from
Payee, forthwith be due and payable, if not already due and payable; and when
any Event of Dealt described in clause (i), (iii), (vi), (vii), (viii), (x) or
(xi) of this Section 4(a) has occurred, then, at the option of Payee, the
principal of this Loan shall be immediately due and payable by acceleration,
without presentment, demand or notice of any kind, upon the occurrence
thereof.If any principal or installment of interest is not paid in full on the
due date thereof (whether by maturity or acceleration or otherwise), then the
outstanding principal balance of this Loan and any overdue installment of
interest thereon (to the extent permitted by applicable law) shall bear
additional interest from the due date of such payment, or from and after an
Event of Default, at a rate equal to the lesser of (1) the highest rate allowed
by applicable law, or (2) the Prime Rate plus two percent (2%) per annum (the
"Default Rate") until the amount due is paid. If payment of this Loan is
accelerated, then the outstanding principal balance thereof shall bear interest
at the Default Rate from and after the Event of Default and, at the option of
Payee, payment of interest shall be made in cash.
<PAGE>
<PAGE> 6
(b) If an Event of Default shall have occurred pursuant to
Section 4(a), Payee shall be entitled, in addition to the rights specified in
Section 4(a), to proceed to protect and enforce any or all other rights, powers
and remedies of the Payee by an action at law, suit in equity or other
appropriate proceeding, whether for the specific performance of any covenant
contained herein or in the Loan and Securities Purchase Agreement, the Warrant
or any Additional Warrant or for an injunction against a violation of any of
the terms hereof or thereof, or in aid of the exercise of any right, power or
remedy granted hereby or thereby or available at law, in equity, by statute or
otherwise. In furtherance of the foregoing and not by way of limitation, the
Payee shall be entitled to specific performance as a remedy for any breach by
Maker of its obligations to prepay this Loan in Units to the extent required by
Section 3 hereof.
(c) If any holder of any shares of capital stock or any
indebtedness of the Maker for borrowed money shall serve any notice or demand
or take any other action in respect of a claimed default, the Maker shall
forthwith give written notice thereof to Payee, describing the notice, demand
or action and the nature of the claimed default.
(d) No right or remedy conferred upon or reserved to Payee, or
now or hereafter existing at law or in equity or by statute or other
legislative enactment, is intended to be exclusive of any other right or
remedy, and each and every such right or remedy shall be cumulative and
concurrent, and shall be in addition to every other such right or remedy, and
may be pursued singly, concurrently, successively or otherwise, at the sole
discretion of Payee.
5. Costs and Expenses. Following the occurrence of any Event of
Default, Maker shall pay upon demand all reasonable costs and expenses
(including all reasonable amounts paid to attorneys), incurred by Payee in the
exercise of any of its rights and remedies hereunder with respect to such Event
of Default and any amount thereof not paid promptly following demand therefor
shall be added to the principal sum hereunder and shall bear interest at the
rate per annum set forth above from the date of such demand until paid in full.
6. Waivers. Maker hereby waives presentment, demand notice of
nonpayment, protest, notice of protest or other notice of dishonor, and (except
as otherwise provided herein) any and all other notices in connection with any
default in the payment of, or any enforcement of the payment of all amounts due
under this Note. To the extent permitted by law, Maker waives the right to any
stay of execution and the benefit of all exemption laws now or hereafter in
effect.
7. Severability. In the event that for any reason one or more of
the provisions of this Note or their application to any person or circumstance
shall be held to be invalid, illegal or unenforceable in any respect or to any
extent, such provisions shall nevertheless remain valid, legal and enforceable
in all such other respects and to such extent as may be permissible. In
addition, any such invalidity, illegality or unenforceability shall not affect
any other provisions of this Note, but this Note shall be construed as if such
<PAGE>
<PAGE> 7
invalid, illegal or unenforceable provision had never been contained herein.In
furtherance and not in limitation of the foregoing, in no event shall this Note
(or the Loan evidenced hereunder) be prepayable in Units, nor shall any
warrants issued upon such prepayment into Units be exchangeable, in whole or in
part for shares of Common Stock, nor shall shares of Common Stock be issued by
the Maker in connection herewith, to the extent that such prepayment, exchange
or issuance (as the case may be) would result, or could reasonably be construed
to result, in a violation of the business combination statute.
8. Transfer; Successors and Assigns. Neither this Note, nor any
portion hereof, may be transferred or disposed of except to an Affiliate of the
Payee. Neither this Note, nor any portion hereof, may be transferred or
disposed of unless registered under the Act and any applicable state securities
laws or there exists a valid exemption therefrom. Subject to the foregoing,
this Note inures to the benefit of Payee and binds Maker, and their respective
successors and assigns, and the words "Payee" and "Maker" whenever occurring
herein shall be deemed and construed to include such respective successors and
assigns.
9. Notices. All notices required to be given to either of the
parties hereunder shall be in writing and shall be deemed to have been
sufficiently given for all purposes when presented personally to such party,
sent by overnight courier, or sent by certified or registered mail, return
receipt requested, to such party at its address set forth in the heading of
this Note. Such notice shall be deemed to be given when received if delivered
personally, the next day after the date sent if sent by overnight courier, or
three days after the date mailed if sent by certified or registered mail. Any
notice of any change in such address shall also be given in the manner set
forth above. Whenever the giving of notice is required the giving of such
notice may be waived in writing by the party entitled to receive such notice.
10. Captions. The captions of the paragraphs in this Note are for
convenience only and shall not affect the meaning of any of the terms or
provisions of this Note.
11. No Recourse. No recourse shall be had for any obligation of the
Maker hereunder, or for any claim based thereon or otherwise in respect
thereof, against any past, present or future trustee, shareholder, officer or
employee of the Maker, whether by virtue of any statute or rule of law, or by
the enforcement of any assessment or penalty or otherwise, all such other
liability being expressly waived and released by the Payee.
12. Governing Law. This Note shall be governed by and construed in
accordance with the laws of the State of Maryland.
<PAGE>
<PAGE> 8
IN WITNESS WHEREOF, Maker has executed this Promissory Note the day
and year first above written.
BRANDYWINE REALTY TRUST
By: /s/ Gerard H. Sweeney
----------------------
Title: President
<PAGE>
Exhibit 7.7
THE SECURITIES REPRESENTED HEREBY AND ISSUABLE UPON EXERCISE HEREOF HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR
UNDER THE SECURITIES LAWS OF ANY STATE. ALL SUCH SECURITIES ARE SUBJECT TO
RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED OR RESOLD
EXCEPT AS PERMITTED UNDER THE ACT AND THE APPLICABLE STATE SECURITIES LAWS,
PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM. THE ISSUER OF SUCH SECURITIES
MAY REQUIRE AN OPINION OF COUNSEL IN FORM AND SUBSTANCE REASONABLY SATISFACTORY
TO THE ISSUER TO THE EFFECT THAT ANY PROPOSED TRANSFER OR RESALE IS IN
COMPLIANCE WITH THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS.
Void after 5:00 p.m. New York Time, on June 21, 2002.
BRANDYWINE REALTY TRUST
Warrant Agreement for the Purchase of Shares of Common Stock
No. 1 59,949 Shares
FOR VALUE RECEIVED, BRANDYWINE REALTY TRUST, a Maryland real estate
investment trust (the "Company"), with its principal office at Two Greentree
Centre, Suite 100, Marlton, New Jersey 08053, hereby certifies that Turkey
Vulture Fund XIII, Ltd. or its assigns (the "Holder") is entitled, subject to
the provisions of this Warrant, to purchase from the Company, at any time
before 5:00 p.m. (Eastern Time) on June 21, 2002 (the "Expiration Date"), the
number of fully paid and nonassessable common shares of beneficial interest of
the Company (the "Common Stock") set forth above, subject to adjustment as
hereinafter provided.
The Holder may purchase such number of shares of Common Stock at a
purchase price per share (as appropriately adjusted pursuant to Section 6 or
Section 8 hereof) of Six Dollars and 50/100 Cents ($6.50) (the "Exercise
Price"). As provided in Section 6(i), the term "Common Stock" shall mean the
aforementioned Common Stock of the Company, together with any other equity
securities that may be issued by the Company in addition thereto or in
substitution therefor as provided herein.
The number of shares of Common Stock to be received upon the exercise
of this Warrant and the price to be paid for a share of Common Stock are
subject to adjustment from time to time as hereinafter set forth. The shares
of Common Stock deliverable upon such exercise, as adjusted from time to time,
are hereinafter sometimes referred to as "Warrant Shares."
Section 1. Exercise of Warrant. (a) This Warrant may be exercised
in whole or in part on any business day (the "Exercise Date") and on or before
the Expiration Date by presentation and surrender hereof to the Company at its
principal office at the address set forth in the initial paragraph hereof or at
the office of its stock transfer or warrant agent, if any, (or at such other
address as the Company may hereafter notify the Holder in writing) with the
Purchase Form annexed hereto duly executed and accompanied by proper payment of
<PAGE>
<PAGE> 2
the Exercise Price in lawful money of the United States of America in the form
of a check, subject to collection, for the number of Warrant Shares specified
in the Purchase Form. If this Warrant should be exercised in part only, the
Company shall, upon surrender of this Warrant, execute and deliver a new
Warrant evidencing the rights of the Holder thereof to purchase the balance of
the Warrant Shares purchasable hereunder. Upon receipt by the Company of this
Warrant and such Purchase Form, together with proper payment of the Exercise
Price, at such office, the Holder shall be deemed to be the holder of record of
the Warrant Shares, notwithstanding that the stock transfer books of the
Company shall then be closed or that certificates representing such Warrant
Shares shall not then be actually delivered to the Holder. The Company shall
pay any and all documentary stamp or similar issue or transfer taxes payable in
respect of the issue or delivery of the Warrant Shares.
(b) In addition to and without limiting the rights of the Holder
under any other terms set forth herein, the Holder shall have, upon written
request by the Holder delivered or transmitted to the Company together with
this Warrant, the right (the "Conversion Right") to require the Company to
convert this Warrant into shares of Common Stock as follows: upon exercise of
the Conversion Right, the Company shall deliver to the Holder (without payment
by the Holder of any Exercise Price) that number of shares of Common Stock that
is equal to the quotient obtained by dividing (x) the value of this Warrant at
the time the Conversion Right is exercised (determined by subtracting the
aggregate Exercise Price in effect immediately prior to the exercise of the
Conversion Right from the aggregate current market value (determined as
provided in Section 3 below) of the shares of Common Stock issuable upon
exercise of this Warrant immediately prior to the exercise of the Conversion
Right) by (y) the current market value of one share of Common Stock (determined
as provided in Section 3 below) immediately prior to the exercise of the
Conversion Right.
The Conversion Right referred to above may be exercised by the Holder
by surrender of this Warrant at the principal office of the Company or at the
offices of its stock transfer or warrant agent, if any, together with a written
statement specifying that the Holder thereby intends to exercise the Conversion
Right. Certificates for shares of Common Stock issuable upon exercise of the
Conversion Right shall be delivered to the Holder within fifteen (15) days
following the Company's receipt of this Warrant together with the aforesaid
written statement.
(c) Notwithstanding anything herein to the contrary, in no event
shall the Company be required to issue shares of Common Stock upon the exercise
hereof if, at the time of such exercise, the issuance of such shares would be
restricted by Section 3.3(a) of the Company's Declaration of Trust, as in
effect on the date hereof; provided that if the amendment to the Declaration of
Trust intended to eliminate Section 3.3(a) is approved by shareholders of the
Company, the foregoing provision of this Section 1(c) shall have no force and
effect. Notwithstanding anything herein to the contrary, in no event shall the
Company be required to issue shares of Common Stock upon the exercise hereof if
and to the extent that, at the time of such exercise, the sum of the market
value of such shares (as determined in accordance with the provisions of
<PAGE>
<PAGE> 3
Section 3-601 et seq. of the Maryland General Corporation Law), plus the VEI
and VOS, would exceed 4.9% of the total market value of the outstanding stock
of the Company as of such date (as determined in accordance with said
statute).As used herein, the terms "VEI" and "VOS" shall have the respective
meanings assigned to them in the Promissory Note dated the date hereof issued
by the Company to the Holder.
Section 2. Reservation of Shares. The Company shall reserve at all
times for issuance and delivery upon exercise of this Warrant all shares of its
Common Stock or other shares of capital stock of the Company from time to time
issuable upon exercise of this Warrant. All such shares shall be duly
authorized and, when issued upon the exercise of the Warrant in accordance with
the terms hereof, shall be validly issued, fully paid and nonassessable, free
and clear of all taxes, liens, security interests, charges and other
encumbrances or restrictions (other than restrictions pursuant to applicable
federal and state securities laws) and free and clear of all preemptive
rights.If the Common Stock is listed on any national securities exchange or The
NASDAQ National Market, the Company shall also list the shares issued upon
exercise of the Warrant on such exchange, subject to notice of issuance, or
maintain the listing of its Common Stock on the NASDAQ system, as the case may
be.
Section 3. Fractional Interest. The Company will not issue a
fractional share of Common Stock or scrip upon any exercise or conversion of
this Warrant. Instead, the Company will deliver its check for the "current
market value" of the fractional share. The "current market value" of a
fraction of a share is determined as follows: multiply the "current market
price" of a full share by the fraction of a share and round the result to the
nearest cent.
The "current market price" of a share of Common Stock shall be
determined as follows:
(a) If the Common Stock is listed on a national securities exchange
or admitted to unlisted trading privileges on such exchange or listed for
trading on The NASDAQ National Market, the current market price shall be the
mean of the last reported sale prices of the Common Stock on such exchange or
system over the last ten (10) business days prior to the date of exercise of
this Warrant, or if no such sale is made on such day, the average closing bid
and asked prices of the Common Stock for such day on such exchange or system;
or
(b) If the Common Stock is not so listed or admitted to unlisted
trading privileges, the current market price shall be the mean of the last
reported bid and asked prices reported by the National Quotation Bureau, Inc.,
over the last ten (10) business days prior to the date of exercise of this
Warrant; or
(c) If the Common Stock is not so listed or admitted to unlisted
trading privileges and bid and asked prices are not so reported, the current
market price per share shall be an amount, not less than 90% of the book value
per share of the Common Stock as at the end of the most recent fiscal year of
<PAGE>
<PAGE> 4
the Company ending prior to the date of the exercise of this Warrant,
determined in such reasonable manner as may be prescribed in good faith by the
Board of Trustees of the Company.
Section 4. Exchange, Transfer, Assignment or Loss of Warrant.
(a) The Holder of this Warrant may not transfer or assign its
interest in this Warrant, or any of the Warrant Shares, in whole or in part,
unless, prior to any such transfer, the transferee agrees in writing, in form
and substance reasonably satisfactory to the Company, to be bound by the terms
of this Agreement and provides the Company with an opinion of counsel in such
form reasonably acceptable to the Company, that such transfer would not be in
violation of the Act or any applicable state securities or blue sky laws.
(b) Subject to the provisions of subsection (a) above and Section
10, upon surrender of this Warrant to the Company or its stock transfer agent
or warrant agent, accompanied by the Assignment Form annexed hereto duly
executed and funds sufficient to pay any transfer tax, the Company shall,
without charge, execute and deliver a new Warrant or Warrants in the name of
the assignee or assignees named in such instrument of assignment and, if the
Holder's entire interest is not being assigned, in the name of the Holder, and
this Warrant shall promptly be canceled.
(c) This Warrant may be divided by or combined with other Warrants
which carry the same rights upon presentation hereof at the principal office of
the Company or at the office of its stock transfer or warrant agent, if any,
together with a written notice specifying the names and denominations in which
new Warrants are to be issued and signed by the Holder hereof. The term
"Warrant" as used herein includes any warrants into which this Warrant may be
divided or exchanged.
(d) Upon receipt of evidence satisfactory to the Company of the
loss, theft, destruction or mutilation of this Warrant, and (in the case of
loss, theft or destruction) of indemnification reasonably satisfactory to the
Company, and upon surrender and cancellation of this Warrant, if mutilated, the
Company shall execute and deliver a new Warrant of like tenor and date
registered in the Holder's name representing the number of shares purchasable
under the original Warrant. Any such new Warrant executed and delivered shall
constitute an additional contractual obligation of the Company, whether or not
the original Warrant shall be at any time enforceable by anyone.
Section 5. Rights of the Holder. The Holder shall not, by virtue
hereof, be entitled to any rights of a shareholder in the Company, either at
law or equity, and the rights of the Holder are limited to those set forth in
this Warrant.
Section 6. Adjustment of Exercise Price and Number of Shares. The
number and kind of securities purchasable upon the exercise of each Warrant and
the Exercise Price shall be subject to adjustment from time to time upon the
occurrence of certain events, as follows:
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<PAGE> 5
(a) Adjustment for Change in Capital Stock. If at any time after
the date hereof, the Company:
(i) pays a dividend or makes a distribution on its Common
Stock in shares of its Common Stock;
(ii) subdivides its outstanding shares of Common Stock into a
greater number of shares;
(iii) combines its outstanding shares of Common Stock into a
smaller number of shares;
(iv) makes a distribution on its Common Stock in shares of its
capital stock other than Common Stock; or
(v) issues by reclassification of its Common Stock any shares
of its capital stock;
then the Exercise Price in effect (and the number of Warrant Shares and other
securities, if any, issuable upon exercise of this Warrant) immediately prior
to such action shall be adjusted so that the Holder may receive upon exercise
of the Warrant, and payment of the same aggregate consideration, the number of
shares of capital stock of the Company which the Holder would have owned
immediately following such action if the Holder had exercised the Warrants
immediately prior to such action.
The adjustment shall become effective immediately after the record
date in the case of a dividend or distribution, and immediately after the
effective date in the case of a subdivision, combination or reclassification.
(b) Adjustment for Other Distributions. If at any time after the
date hereof, the Company distributes to all holders of its Common Stock any of
its assets or debt securities, the Exercise Price following the record date for
such distribution shall be adjusted in accordance with the following formula:
M-F
---
E' = E x M
where: E' = the adjusted Exercise Price.
E = the Exercise Price immediately prior to the adjustment.
M = the current market price (as defined in Section 3 above)
per share of Common Stock on the record date of the
distribution.
F = the aggregate fair market value (determined in such
reasonable manner as may be prescribed in good faith by the
Board of Trustees of the Company) on the record date of the
distribution of the assets or debt securities divided by
the number of outstanding shares of Common Stock.
<PAGE>
<PAGE> 6
The adjustment shall be made successively whenever any such
distribution is made and shall become effective immediately after the record
date for the determination of shareholders entitled to receive the distribution
or the effective date of such issuance, as applicable. In the event that such
distribution or issuance is not actually made, the Exercise Price shall again
be adjusted to the Exercise Price as determined without giving effect to the
calculation provided hereby.
This subsection does not apply to cash dividends or cash
distributions paid out of consolidated current or retained earnings as shown on
the books of the Company and paid in the ordinary course of business.
(c) Adjustment for Common Stock Issue. (i) If at any time after
the date hereof, the Company issues shares of Common Stock for a consideration
per share that is less than the current market price per share (determined as
provided in Section 3 above) on the date the Company fixes the offering price
of such additional shares, the Exercise Price shall be adjusted in accordance
with the following formula:
E' = Y x [O + (P / E)]
-------------
A
where: E' = the adjusted Exercise Price.
Y = the then current Exercise Price immediately prior to the
adjustment.
O = the number of shares outstanding immediately prior to the
issuance of such additional shares.
P = the aggregate consideration received for the issuance of
such additional shares.
E = the current market price (determined as provided in Section
3 above) immediately prior to the adjustment.
A = the number of shares outstanding immediately after the
issuance of such additional shares.
The adjustment shall be made successively whenever any such issuance
is made, and shall become effective immediately after such issuance.
(ii) This subsection 6(c) does not apply to (A) any of the
transactions described in subsections (b) and (d) of this Section 6, (B) Common
Stock issued pursuant to options and warrants outstanding on the date hereof,
(C) Common Stock issued to officers, trustees, directors or employees of, or
consultants to, the Company and its affiliates upon the exercise of warrants,
<PAGE>
<PAGE> 7
rights or options which (x) are issued pursuant to employee benefit plans,
employment agreements or consulting agreements, in each case approved by the
Company's Board of Trustees or an appropriate committee of the Company's Board
of Trustees, and (y) have an exercise price not less than 85% of the current
market price of the Company's Common Stock at the time of issuance of such
warrant, right or option, (D) Common Stock issued in exchange for Class A units
of limited partnership interest in Brandywine Operating Partnership, L.P.
issuable to Safeguard Scientifics, Inc. ("SSI"), The Nichols Company ("TNC"),
and certain other persons in connection with the transactions (the "SSI/TNC
Transaction") contemplated by the Letter of Intent dated March 20, 1996, by and
among the Company, SSI and TNC, (E) up to 730,000 shares of Common Stock
reserved for issuance upon exercise of warrants to be issued to certain
employees of the Company and TNC in connection with the SSI/TNC Transaction,
(F) up to 775,000 shares of Common Stock reserved for issuance to SSI upon the
exercise of a warrant to be issued to it in connection with the SSI/TNC
Transaction, (G) Common Stock issued to the Holder in connection with the
repayment of its loan to the Company or in connection with the exercise of any
warrants issued to the Holder in connection with any such repayment (the
"Repayment Warrants"), and (H) any securities sold to the public in connection
with an underwritten public offering of the Company's securities.
(d) Adjustment for Convertible Securities Issue. If at any time
after the date hereof, the Company issues for consideration any securities
convertible into or exchangeable or exercisable for Common Stock for
consideration per share of Common Stock initially deliverable upon conversion,
exchange or exercise of such securities, together with the consideration paid
upon issuance of such securities, less than the current market price per share
(determined as provided in Section 3 above) on the date of issuance of such
securities, the Exercise Price shall be adjusted in accordance with this
formula:
E' = Y x [O + (P / E)]
-------------
O + D
where: E' = the adjusted Exercise Price.
Y = the then current Exercise Price immediately prior to the
adjustment.
O = the number of shares outstanding immediately prior to the
issuance of such securities.
P = the aggregate consideration received and receivable for the
issuance of such securities.
E = the current market price (determined as provided in Section
3 above).
D = the maximum number of shares deliverable upon conversion,
exchange or exercise of such securities at the initial
conversion, exchange or exercise rate.
<PAGE>
<PAGE> 8
The adjustment shall be made successively whenever any such issuance
is made, and shall become effective immediately after such issuance. If all of
the Common Stock deliverable upon conversion, exchange or exercise of such
securities has not been issued when such securities are no longer outstanding,
then the Exercise Price shall promptly be readjusted to the Exercise Price
which would then be in effect had the adjustment upon the issuance of such
securities been made on the basis of the actual number of shares of Common
Stock issued upon conversion, exchange or exercise of such securities.
This subsection does not apply to any of the transactions described
in subsections (c)(ii)(B), (C), (D), (E), (F) and (G) above.
(e) Adjustment to Number of Warrant Shares. Upon each adjustment to
the Exercise Price pursuant to Section 6(c) or (d), the number of Warrant
Shares purchasable hereunder at that Exercise Price shall be adjusted, to the
nearest one hundredth of a whole share, to the product obtained by multiplying
such number of shares purchasable immediately prior to such adjustment in the
Exercise Price by a fraction, the numerator of which shall be the Exercise
Price immediately prior to such adjustment and the denominator of which shall
be the Exercise Price immediately thereafter.
(f) Deferral of Issuance or Payment. In any case in which an event
covered by this Section 6 shall require that an adjustment in the Exercise
Price be made effective as of a record date, the Company may elect to defer
until the occurrence of such event (i) issuing to the Holder, if this Warrant
is exercised after such record date, the shares of Common Stock and other
capital stock of the Company, if any, issuable upon such exercise over and
above the shares of Common Stock or other capital stock of the Company, if any,
issuable upon such exercise on the basis of the Exercise Price in effect prior
to such adjustment, and (ii) paying to the Holder by check any amount in lieu
of the issuance of fractional shares pursuant to Section 3.
(g) When No Adjustment Required. No adjustment need be made for a
change in the par value or no par value of the Common Stock.
(h) Notice of Certain Actions. In the event that:
(i) the Company shall authorize the issuance to all holders of
its Common Stock of rights, warrants, options or convertible securities to
subscribe for or purchase shares of its Common Stock, or of any other
subscription rights, warrants, options or convertible securities; or
(ii) the Company shall authorize the distribution to all holders
of its Common Stock of evidences of its indebtedness or assets (other than
dividends paid in or distributions of the Company's capital stock for which the
Exercise Price shall have been adjusted pursuant to subsection (a) of this
Section 6) or cash dividends or cash distributions payable out of consolidated
current or retained earnings as shown on the books of the Company and paid in
the ordinary course of business); or
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<PAGE> 9
(iii) the Company shall authorize any capital reorganization or
reclassification of the Common Stock (other than a subdivision or combination
of the outstanding Common Stock and other than a change in par value of the
Common Stock) or of any consolidation or merger to which the Company is a party
and for which approval of any shareholders of the Company is required (other
than a consolidation or merger in which the Company is the continuing
corporation and that does not result in any reclassification or change of the
Common Stock outstanding), or of the conveyance or transfer of the properties
and assets of the Company as an entirety or substantially as an entirety; or
(iv) the Company is the subject of a voluntary or involuntary
dissolution, liquidation or winding-up procedure; or
(v) the Company proposes to take any action (other than actions
of the character described in subsection (a) of this Section 6) that would
require an adjustment of the Exercise Price pursuant to this Section 6; then
the Company shall cause to be mailed by first-class mail to the Holder, at
least ten (10) days prior to the applicable record or effective date, a notice
stating (x) the date as of which the holders of Common Stock of record to be
entitled to receive any such rights, warrants or distributions are to be
determined, or (y) the date on which any such consolidation, merger,
conveyance, transfer, dissolution, liquidation or winding-up is expected to
become effective, and the date as of which it is expected that holders of
Common Stock of record shall be entitled to exchange their shares of Common
Stock for securities or other property, if any, deliverable upon such
reorganization, reclassification, consolidation, merger, conveyance, transfer,
dissolution, liquidation or winding-up.
(i) No Adjustment Upon Exercise of Warrants. No adjustments shall
be made under any Section herein in connection with the issuance of Warrant
Shares upon exercise of the Warrants.
(j) Common Stock Defined. The term "Common Stock" shall include any
equity securities of any class of the Company hereinafter authorized which
shall not be limited to a fixed sum or percentage in respect of the right of
the holders thereof to participate in dividends or distributions of assets upon
the voluntary or involuntary liquidation, dissolution or winding up of the
Company. However, subject to the provisions of Section 8 hereof, shares
issuable upon exercise hereof shall include only shares of the class designated
as Common Stock of the Company as of the date hereof or shares of any class or
classes resulting from any reclassification or reclassifications thereof or as
a result of any corporate reorganization as provided for in Section 8 hereof.
(k) Warrants Issued After Adjustments. Irrespective of any
adjustments in the Exercise Price or the number or kind of Warrant Shares
purchasable upon exercise of this Warrant, Warrants theretofore or thereafter
issued may continue to express the same price and number and kind of shares as
are stated in the similar warrants initially issuable pursuant to this
Agreement.
<PAGE>
<PAGE> 10
Section 7. Officers' Certificate. Whenever the Exercise Price shall
be adjusted as required by the provisions of Section 6, the Company shall
forthwith file in the custody of its Secretary or an Assistant Secretary at its
principal office an officers' certificate showing the adjusted Exercise Price
determined as herein provided, setting forth in reasonable detail the facts
requiring such adjustment and the manner of computing such adjustment. Each
such officers' certificate shall be signed by the Chairman, President or Chief
Financial Officer of the Company and by the Secretary or any Assistant
Secretary of the Company. A copy of each such officers' certificate shall be
promptly mailed, by certified mail, to each holder of a Warrant and the
original shall be made available at all reasonable times for inspection by any
other holder of a Warrant executed and delivered pursuant to Section 4 hereof.
Section 8. Reclassification, Reorganization, Consolidation or
Merger. In the event of any reclassification, capital reorganization or other
change of outstanding shares of Common Stock of the Company (other than a
subdivision or combination of the outstanding Common Stock and other than a
change in the par value of the Common Stock) or in the event of any
consolidation or merger of the Company with or into another person or entity
(other than a merger in which the Company is the continuing person or entity
and that does not result in any reclassification, capital reorganization or
other change of outstanding shares of Common Stock of the class issuable upon
exercise of this Warrant) or in the event of any sale, lease, transfer or
conveyance to another person or entity of the property and assets of the
Company as an entirety or substantially as an entirety, the Company shall, as a
condition precedent to such transaction, cause effective provisions to be made
so that the Holder shall have the right thereafter, by exercising this Warrant,
to purchase the kind and amount of shares of stock and other securities and
property (including cash) receivable upon such reclassification, capital
reorganization and other change, consolidation, merger, sale or conveyance by a
holder of the number of shares of Common Stock that might have been received
upon exercise of this Warrant immediately prior to such reclassification,
capital reorganization, change, consolidation, merger, sale or conveyance. Any
such provision shall include provisions for adjustments in respect of such
shares of stock and other securities and property that shall be as nearly
equivalent as may be practicable to the adjustments provided for in this
Warrant. The foregoing provisions of this Section 8 shall similarly apply to
successive reclassifications, capital reorganizations and changes of shares of
Common Stock and to successive consolidations, mergers, sales or conveyances.In
the event that in connection with any such capital reorganization, or
classification, consolidation, merger, sale or conveyance, additional shares of
Common Stock shall be issued in exchange, conversion, substitution or payment,
in whole or in part, for, or of, a security of the Company other than Common
Stock, any such issue shall be treated as an issue of Common Stock covered by
the provisions of Section 6 hereof.
Section 9. Duty to Make Fair Adjustments in Certain Cases. If any
event occurs as to which, in the reasonable opinion of either the Board of
Trustees of the Company or a majority of the holders of the warrants then
outstanding under this Warrant, the Repayment Warrants and the Warrant to be
issued to SSI as part of the SSI/TNC Transaction (the "SSI Warrant"), the
<PAGE>
<PAGE> 11
provisions of Section 6 and Section 8 hereof are not strictly applicable or, if
strictly applicable, would not fairly protect the purchase rights of such
warrants in accordance with the essential intent and principles of such
provisions, then the Board of Trustees of the Company and a majority of the
holders of the warrants then outstanding under this Warrant, the Repayment
Warrants and the SSI Warrant shall mutually agree upon an adjustment in the
application of such provisions, in accordance with such essential intent and
principles, so as to protect such purchase rights as aforesaid.
Section 10. Transfer to Comply with the Securities Act of 1933;
Registration Rights.
(a) No sale, transfer, assignment, hypothecation or other
disposition of this Warrant or of the Warrant Shares shall be made if such
sale, transfer, assignment, hypothecation or other disposition would result in
a violation of the Act, or any state securities laws. Upon exercise of this
Warrant, the Holder shall, if requested by the Company, confirm in writing, in
a form reasonably satisfactory to the Company, that the shares of Common Stock
so purchased are being acquired solely for the Holder's own account, and not as
a nominee thereof, for investment, and not with a view toward distribution or
resale, except as permitted by the Act, and shall provide such other
information to the Company as the Company may reasonably request. Any Warrant
and any Warrants issued upon substitution for, or upon assignment or transfer
of this Warrant, as the case may be, and all shares of Common Stock issued upon
exercise hereof or conversion thereof shall bear a legend (in addition to any
legend required by state securities laws) in substantially the form set forth
on the first page of this Warrant, unless and until such securities have been
transferred pursuant to an effective registration statement under the Act or
may be freely sold to the public pursuant to Rule 144 (or any successor rule
thereto) or otherwise.
(b) The Holder and any transferee of the Warrant or the Warrant
Shares issuable hereunder shall have the right to require the Company to
register the Warrant Shares with the Securities and Exchange Commission for
resale as contemplated by Section 3.2.9 of the Loan and Securities Purchase
Agreement dated the date hereof between the Company and the Holder.
Section 11. Modification and Waiver. Neither this Warrant nor any
term hereof may be changed, waived, discharged or terminated other than by an
instrument in writing signed by the Company and by the Holder hereof.
Section 12. Notices. Any notice, request or other document required
or permitted to be given or delivered to the Holder hereof or the Company shall
be delivered or shall be sent by certified mail, postage prepaid, or by
overnight courier to each such Holder at its address as shown on the books of
the Company or to the Company at the address indicated therefor in the first
paragraph of this Warrant.
Section 13. Descriptive Headings and Governing Law. The description
headings of the several sections and paragraphs of this Warrant are inserted
for convenience only and do not constitute a part of this Warrant. This
<PAGE>
<PAGE> 12
Warrant shall be construed and enforced in accordance with, and the rights of
the parties shall be governed by, the laws of the State of Maryland.
Section 14. No Impairment. The Company will not knowingly avoid or
seek to avoid the observance or performance of any of the terms to be observed
or performed hereunder by it, but will at all times in good faith assist in the
carrying out of all of the provisions of this Warrant.
Section 15. Non-Recourse. No recourse shall be had for any
obligation of the Company hereunder, or for any claim based thereon or
otherwise in respect thereof, against any past, present or future trustee,
shareholder, officer or employee of the Company, whether by virtue of any
statute or rule of law, or by the enforcement of any assessment or penalty or
otherwise, all such other liability being expressly waived and released by each
other party hereto.
IN WITNESS WHEREOF, the Company has duly caused this Warrant to be
signed by its duly authorized officer and to be dated as of June 21, 1996.
BRANDYWINE REALTY TRUST
By: /s/ Gerard H. Sweeney
----------------------
Title: President
----------------------
<PAGE>
<PAGE> 13
PURCHASE FORM
Dated:
The undersigned hereby irrevocably elects to exercise the within
Warrant to purchase _____________ shares of Common Stock and hereby makes
payment of ___________________________ in payment of the exercise price
thereof.
Signature
<PAGE>
<PAGE> 13
ASSIGNMENT FORM
Dated:
FOR VALUE RECEIVED, hereby sells, assigns and transfers unto
(the "Assignee"),
(please type or print in block letters)
(insert address)
its right to purchase up to shares of Common Stock represented by
this Warrant and does hereby irrevocably constitute and appoint
_______________________________ Attorney, to transfer the same on the books of
the Company, with full power of substitution in the premises.
Signature
<PAGE>
Exhibit 7.8
EXHIBIT D
REGISTRATION RIGHTS AGREEMENT
REGISTRATION RIGHTS AGREEMENT (the "Agreement") made and entered into
as of this th day of , 1996 by and among BRANDYWINE REALTY TRUST, a
Maryland real estate investment trust (the "Company"), SAFEGUARD SCIENTIFICS
(DELAWARE), INC., a Delaware corporation ("SSI"), THE NICHOLS COMPANY, a
Pennsylvania corporation ("TNC"), and the TURKEY VENTURE FUND XIII, LTD., an
Ohio limited liability company of which Richard M. Osborne is the manager
("TVF XIII").
BACKGROUND
Pursuant to a Stock and Warrant Purchase Agreement, dated ,
1996 (the "SSI Agreement"), by and between the Company and Safeguard
Scientifics, Inc., a Pennsylvania corporation, the Company has issued to SSI
775,000 (the "SSI Shares") of the Company's common shares of beneficial
interest (the "Common Stock") and a Warrant to purchase an additional 775,000
shares of Common Stock (the "SSI Warrant").
Pursuant to a Loan and Securities Purchase Agreement, dated June 21,
1996, by and between the Company and TVF XIII (a) the Company has issued to
TVF XIII 59,949 shares (the "Initial TVF XIII Shares") of the Company's Common
Stock and a warrant to purchase an additional 59,949 shares of Common Stock
(the "Initial TVF XIII Warrant") and (b) TVF XIII has made a loan to the
Company that in accordance with the terms of said agreement may be repaid with
additional shares of the Company's Common Stock (the "Additional TVF XIII
Shares" and together with the Initial TVF XIII Shares, the "TVF XIII Shares")
and additional warrants to purchase additional shares of the Company's Common
Stock (the "Additional TVF XIII Warrant" and, together with the Initial
TVF XIII Warrant, the "TVF XIII Warrants") (the TVF XIII Warrants, together
with the SSI Warrant, the "Warrants").
In connection with the SSI Agreement, the Company has acquired,
either directly or indirectly, a general partnership interest in Brandywine
Operating Partnership, L.P., a Delaware limited partnership (the
"Partnership"), and SSI, TNC and certain other persons listed on Schedule A
hereto (the "Other Purchasers") have received units of Class A Limited
Partnership Interest in the Partnership in exchange for certain interests in
real property and other assets contributed by them to the Partnership. These
units are redeemable, on a one-for-one basis, subject to adjustment, for shares
of Common Stock upon the satisfaction of certain conditions, as provided in the
Agreement of Limited Partnership of even date herewith creating the Partnership
(the "Partnership Agreement").
To induce SSI, TNC, the Other Purchasers and TVF XIII to enter into
the foregoing transactions, the Company has agreed to provide them with the
registration rights set forth in this agreement.
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<PAGE> 2
1. CERTAIN DEFINITIONS.
In addition to the other terms defined in this Agreement, the
following terms shall be defined as follows:
"Brokers Transactions" has the meaning ascribed to such term pursuant
to Rule 144 under the Securities Act.
"Business Day" means any day on which the New York Stock Exchange
("NYSE") is open for trading.
"Closing Date" means , 1996.
"Exchange Act" means the Securities Exchange Act of 1934, as amended,
and the rules and regulations of the SEC thereunder, all as the same shall be
in effect at the relevant time.
"Fair Market Value" means:
(a) If the Registrable Security is listed on a national
securities exchange or admitted to unlisted trading privileges on such exchange
or listed for trading on The NASDAQ Stock Market, the fair market value shall
be the last reported sale price of the Registrable Security on such exchange or
system on the last business day prior to the date the determination of fair
market value is made, or if no such sale is made on such day, the average
closing bid and asked prices of the Registrable Security for such day on such
exchange or system; or
(b) If the Registrable Security is not so listed or admitted to
unlisted trading privileges, the fair market value shall be the mean of the
last reported bid and asked prices reported by the National Quotation Bureau,
Inc., on the last business day prior to the date the determination of fair
market value is made; or
(c) If the Registrable Security is not so listed or admitted to
unlisted trading privileges and bid and asked prices are not so reported, the
fair market value per share shall be an amount, not less than 90% of the book
value per share of the Registrable Security as at the end of the most recent
fiscal year of the Company ending prior to the date the determination of fair
market value is made, determined in such reasonable manner as may be prescribed
in good faith by the Board of Trustees of the Company.
"Holders" means SSI, TNC, TVF XIII and the Other Purchasers listed on
Schedule A hereto, for so long as (and to the extent that) each owns any
Registrable Securities, and each of their respective successors, assigns, and
direct and indirect transferees who become registered owners of Registrable
Securities or securities exercisable, exchangeable or convertible into
Registrable Securities.
"Outstanding" means with respect to any securities as of any date,
all such securities theretofore issued, except any such securities theretofore
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<PAGE> 3
converted, exercised or canceled or held by the issuer or any successor thereto
(whether in its treasury or not) or any affiliate of the issuer or any
successor thereto.
"Registrable Security(ies)" means (i) the SSI Shares, (ii) the
TVF XIII Shares, (iii) all or any portion of any shares of Common Stock of the
Company that may be issued upon the exercise of, or in exchange for, the
Warrants, (iv) any shares of Common Stock or other equity securities of the
Company that may be issued in redemption of any Units under the Partnership
Agreement, and (v) any additional shares of Common Stock or other equity
securities of the Company issued or issuable after the Closing Date in respect
of any such securities (or other equity securities issued in respect thereof)
by way of a stock dividend or stock split, in connection with a combination,
exchange, reorganization, recapitalization or reclassification of Company
securities, or pursuant to a merger, division, consolidation or other similar
business transaction or combination involving the Company; provided that in the
case of equity securities other than Common Stock such securities are
registered under Section 12(b) or Section 12(g) of the Exchange Act; and
further provided that: as to any particular Registrable Securities, such
securities shall cease to constitute Registrable Securities (i) when a
registration statement with respect to the sale of such securities shall have
become effective under the Securities Act and such securities shall have been
disposed of thereunder; or (ii) when and to the extent such securities are
permitted to be publicly sold without limitation as to amount pursuant to Rule
144(k) (or any successor provision to such Rule) under the Securities Act or
are otherwise freely transferrable to the public without further registration
under the Securities Act; or (iii) when such securities shall have ceased to be
issued and outstanding; or (iv) on the tenth anniversary of the date such
securities were issued. In the case of clause (ii) of the foregoing sentence,
the Company shall, if requested by the Holder or Holders thereof, have
delivered to such Holder or Holders the written opinion of independent counsel
to the Company to such effect. Any time this Agreement requires the vote or
consent of the Holder of a "majority" or other stated percentage of the
Registrable Securities, the term Registrable Securities shall, solely for
purposes of calculating such vote, be deemed to include the Registrable
Securities that could be issued under the Units and the Warrant and any other
securities exercisable or exchangeable for, or convertible into, Registrable
Securities. The term Registrable Securities shall not include the Units or the
Warrants.
"Person" means an individual, a partnership (general or limited),
corporation, limited liability company, joint venture, business trust,
cooperative, association or other form of business organization, whether or not
regarded as a legal entity under applicable law, a trust (inter vivos or
testamentary), an estate of a deceased, insane or incompetent person, a
quasi-governmental entity, a government or any agency, authority, political
subdivision or other instrumentality thereof, or any other entity.
"Registration Expenses" means all expenses incident to the Company's
performance of or compliance with the registration requirements set forth in
this Agreement including, without limitation, the following: (i) the fees,
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<PAGE> 4
disbursements and expenses of the Company's counsel(s), accountants, and
experts in connection with the registration under the Securities Act of
Registrable Securities; (ii) all expenses in connection with the preparation,
printing and filing of the registration statement, any preliminary prospectus
or final prospectus, any other offering document and amendments and supplements
thereto, and the mailing and delivering of copies thereof to the underwriters
and dealers, if any; (iii) the cost of printing or producing any agreement(s)
among underwriters, underwriting agreement(s) and blue sky or legal investment
memoranda, any selling agreements, and any other documents in connection with
the offering, sale or delivery of Registrable Securities to be disposed of;
(iv) any other expenses in connection with the qualification of Registrable
Securities for offer and sale under state securities laws, including the fees
and disbursements of counsel for the underwriters in connection with such
qualification and in connection with any blue sky and legal investment surveys;
(v) the filing fees incident to securing any required review by the National
Association of Securities Dealers, Inc. of the terms of the sale of Registrable
Securities to be disposed of and any blue sky registration or filing fees, and
(vi) the fees and expenses incurred in connection with the listing of
Registrable Securities on each securities exchange (or The NASDAQ Stock Market)
on which Company securities of the same class are then listed; provided,
however, that Registration Expenses with respect to any registration pursuant
to this Agreement shall not include (x) expenses incurred by any Holder in
connection with any offering, including the fees and expenses of counsel,
accountants, and experts retained by such Holder (other than the fees and
expenses of one counsel for the Holders as and to the extent provided in
Section 11), (y) any underwriting discounts or commissions attributable to
Registrable Securities, or (z) any SEC registration or filing fees attributable
to Registrable Securities or transfer taxes applicable to Registrable
Securities.
"SEC" means the United States Securities and Exchange Commission, or
such other federal agency at the time having the principal responsibility for
administering the Securities Act.
"Securities Act" means the Securities Act of 1933, as amended, and
the rules and regulations of the SEC thereunder, all as the same shall be in
effect at the relevant time.
"Shelf Registration Statement" means a Shelf Registration Statement
of the Company pursuant to the provisions of Section 2(b) of this Agreement
which covers Common Stock on an appropriate form then permitted by the SEC to
be used for such registration and the sales contemplated to be made thereby,
under Rule 415 under the Securities Act, or any similar rule that may be
adopted by the SEC, and all amendments and supplements to such Registration
Statement, including pre and post-effective amendments thereto, in each case
including the prospectus contained therein, all exhibits thereto and all
material incorporated by reference therein.
"Shelf Registration" means a registration of Common Stock effected
pursuant to Section 2(b) hereof.
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<PAGE> 5
"Trading Day" means a day on which the principal securities exchange
or stock market on which the applicable security is traded is open for the
transaction of business.
"Unit" means any unit of Class A Limited Partnership Interest in the
Partnership and any securities which may be issued in respect thereof or
exchange therefor in connection with any combination, consolidation, merger,
recapitalization, or other similar transaction.
2. DEMAND REGISTRATION; SHELF REGISTRATION.
(a) (i) A Holder or Holders may request at any time (by written
notice delivered to the Company) that the Company register under the Securities
Act all or any portion of the Registrable Securities held by (or then issuable
to) such Holder or Holders (the "Requesting Holders"), representing in the
aggregate not less than twenty percent of the Registrable Securities, for sale
in the manner specified in such notice (including, but not limited to, an
underwritten public offering); provided, however, that no such request may be
made without the written consent of SSI and TVF XIII at any time when SSI or
TVF XIII would be prohibited from selling Registrable Securities pursuant to an
effective registration statement under the Securities Act by the terms of the
Agreement, dated June 21, 1996, between the Company and SSI, or the Agreement,
dated March 20, 1996, among the Company, the Richard M. Osborne Trust and
Richard M. Osborne, as the case may be. In each such case, such notice shall
specify the number of Registrable Securities for which registration is
requested, the proposed manner of disposition of such securities, and the
minimum price per share at which the Requesting Holders would be willing to
sell such securities in an underwritten offering. The Company shall, within
five (5) Business Days after its receipt of any Requesting Holders' notice
under this Section 2(a)(i), give written notice of such request to all other
Holders of Registrable Securities and afford them the opportunity of including
in the requested registration statement such of their Registrable Securities as
they shall specify in a written notice given to the Company within twenty (20)
days after their receipt of the Company's notice. Within ten (10) Business
Days after the expiration of such twenty (20) day period, the Company shall
notify all Holders requesting registration of (A) the aggregate number of
Registrable Securities proposed to be registered by all Holders, (B) the
proposed filing date of the registration statement, and (C) such other
information concerning the offering as any Holder may have reasonably
requested. If the Holders of a majority in aggregate amount of the Registrable
Securities to be included in such offering shall have requested that such
offering be underwritten, the managing underwriter for such offering shall be
chosen by the Holders of a majority in aggregate amount of the Registrable
Securities being registered, with the consent of the Company, which consent
shall not be unreasonably withheld, not less than thirty (30) days prior to the
proposed filing date stated in the Company's notice, and the Company shall
thereupon promptly notify such Holders as to the identity of the managing
underwriter, if any, for the offering. On or before the 30th day prior to such
anticipated filing date, any Holder may give written notice to the Company and
the managing underwriter specifying either that (A) Registrable Securities of
such Holder are to be included in the underwriting, on the same terms and
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<PAGE> 6
conditions as the securities otherwise being sold through the underwriters
under such registration or (B) such Registrable Securities are to be registered
pursuant to such registration statement and sold in the open market without any
underwriting, on terms and conditions comparable to those normally applicable
to offerings in reasonably similar circumstances, regardless of the method of
disposition originally specified in Holder's request for registration.
(ii) The Company shall use its commercially reasonable best
efforts to file with the SEC within eighty (80) days (thirty (30) days if the
Company may use a Registration Statement on Form S-3 to register such
Registrable Securities) after the Company's receipt of the initial Requesting
Holders' written notice pursuant to Section 2(a)(i), a registration statement
for the public offering and sale, in accordance with the method of disposition
specified by such Holders, of the number of Registrable Securities specified in
such notice, and thereafter use its commercially reasonably best efforts to
cause such registration statement to become effective within sixty (60) days
after its filing. Such registration statement may be on Form S-1 or another
appropriate form (including Form S-3) that the Company is eligible to use and
that is reasonably acceptable to the managing underwriter; provided, however,
that if any Form other than Form S-1 is used in an underwritten offering, upon
the request of the managing underwriter, or the selling shareholders, the
prospectus included in the registration statement shall be amplified to include
such additional information as such persons may reasonably request regarding
the Company, its business and management (including, without limitation, the
information called for by Items 101, 102, 103, 201, 202, 301 and 303 of
Regulation S-K under the Securities Act).
(iii) The Company shall not have any obligation hereunder
(A) to permit or participate in more than two offerings pursuant to this
Section 2(a), except as and to the extent provided by Section 7(b), or (B) to
register any Registrable Securities under this Section 2(a) unless it shall
have received requests from Holders to register at least 20% of the aggregate
Registrable Securities issued at the date hereof.
(iv) If the Company is required to use commercially reasonable
best efforts to register Registrable Securities in a registration initiated
upon the demand of any Holder pursuant to Section 2(a) of this Agreement and
the managing underwriters for such offering advise that the inclusion of all
securities sought to be registered by the Holders may interfere with an orderly
sale and distribution of or may materially adversely affect the price of such
offering, the aggregate number of Registrable Securities included by the
Holders in such offering shall be reduced to a number which the managing
underwriters advise will not likely have such effect and the maximum number of
Registrable Securities able to be included in such offering by each Holder
shall be reduced pro rata (in accordance with such Holder's proportionate share
of the Fair Market Value of all Registrable Securities duly requested to be
included in such registration).
(b) At any time during the 60-day period following the end of any
fiscal year of the Company, other than the fiscal year in which a registration
statement is to be filed pursuant to Section 2(a), any Holder or Holders may
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<PAGE> 7
request in writing that the Company register under the Securities Act all or
any portion of the Registrable Securities held by (or then issuable to) such
Requesting Holders for sale pursuant to a Shelf Registration Statement;
provided that any distribution or sale pursuant to any such Shelf Registration
shall be limited to Brokers' Transactions. The Company shall, within five (5)
Business Days after its receipt of any Requesting Holders' notice under this
Section 2(b), give written notice of such request to all other Holders of
Registrable Securities and afford them the opportunity of including in the
requested Shelf Registration Statement such of their Registrable Securities as
they shall specify in a written notice given to the Company within twenty (20)
days after their receipt of the Company's notice. The Company shall thereupon
use its commercially reasonable best efforts to file the Shelf Registration
Statement with the SEC within sixty (60) days after its receipt of the initial
Requesting Holders' notice and to cause such registration statement to be
declared effective within sixty (60) days after its filing; provided, however,
that the Company shall not be required (A) to effect more than one registration
pursuant to this Section 2(b) in any fiscal year for Holders, or (B) to effect
any registration pursuant to this Section 2(b) during the fiscal year during
which Registrable Securities are registered pursuant to Section 2(a) of this
Agreement, or (C) to register any Registrable Securities under this
Section 2(b) unless it shall receive requests from Holders to register at least
10% of the aggregate Registrable Securities issued at the date hereof. The
Company shall use its commercially reasonable best efforts to keep such Shelf
Registration Statement (or, if required hereunder, a successor Shelf
Registration Statement filed pursuant to Section 2(d) below) continuously
effective in order to permit the prospectus forming a part thereof to be usable
by Holders of Registrable Securities until all securities included in such
Shelf Registration Statement have ceased to be Registrable Securities (the
"Lapse Date").
(c) Notwithstanding any other provision of this Agreement, the
Company shall have the right to defer the filing or effectiveness of a
registration statement relating to any registration requested under Section
2(a) for a reasonable period of time not to exceed 180 days if (x) the Company
is, at such time, working on an underwritten, primary public offering of its
securities and is advised by its managing underwriter(s) that such offering
would in its or their opinion be materially adversely affected by such filing;
or (y) a prior registration statement of the Company for an underwritten,
primary public offering by the Company of its securities was declared effective
by the SEC less than 120 days prior to the anticipated effective date of the
requested registration.
(d) If the Company is precluded by Rule 415 or any other applicable
rule under the Securities Act from including all Registrable Securities in any
Shelf Registration or from keeping any Shelf Registration Statement
continuously effective from the filing date thereof through the Lapse Date, the
Company shall file such additional or further Shelf Registration Statements, as
may be required, so that, subject to the other provisions of this Agreement,
all Registrable Securities requested to be included are included on a
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<PAGE> 8
continuously effective Shelf Registration Statement for substantially all of
the period from the filing date of the first Shelf Registration Statement
through the Lapse Date.
(e) Neither the Company nor any Person other than a Holder shall be
entitled to include any securities held by it or him in any underwritten
offering pursuant to Section 2(a) of this Agreement.
(f) No registration of Registrable Securities under this Article 2
shall relieve the Company of its obligation (if any) to effect registrations of
Registrable Securities pursuant to Article 3.
3. INCIDENTAL REGISTRATION.
(a) Until all securities subject to this Agreement have ceased to be
Registrable Securities, if the Company proposes, other than pursuant to Article
2 hereof, to register any of its Common Stock or other securities issued by it
having terms substantially similar to Registrable Securities or any successor
securities (collectively, "Other Securities") for public sale under the
Securities Act (whether proposed to be offered for sale by the Company or by
any other Person) on a form and in a manner which would permit registration of
Registrable Securities for sale to the public under the Securities Act, it will
give prompt written notice (which notice shall specify the intended method or
methods of disposition) to the Holders of its intention to do so, and upon the
written request of any Holder delivered to the Company within fifteen (15)
Business Days after the giving of any such notice (which request shall specify
the number of Registrable Securities intended to be disposed of by such Holder)
the Company will use its commercially reasonable best efforts to effect, in
connection with the registration of the Other Securities, the registration
under the Securities Act of all Registrable Securities which the Company has
been so requested to register by Holders; provided, however, that:
(i) if, at any time after giving such written notice of its
intention to register Other Securities and prior to the effective date of the
registration statement filed in connection with such registration, the Company
shall determine for any reason not to register such Other Securities, the
Company may, at its election, give written notice of such determination to the
Holders requesting registration and thereupon the Company shall be relieved of
its obligation to register such Registrable Securities in connection with the
registration of such Other Securities (but not from its obligation to pay
Registration Expenses to the extent incurred in connection therewith as
provided in Article 11), without prejudice, however, to the rights (if any) of
the Holders to request that such registration be effected as a registration
under Article 2; and
(ii) the Company will not be required to effect any
registration of Registrable Securities pursuant to this Article 3 in connection
with a primary offering of securities by it if the Company shall have been
advised in writing (with a copy to the Holders requesting registration) by a
nationally recognized investment banking firm (which may be the managing
underwriter for the offering) selected by the Company that, in such firm's
opinion, a registration of Registrable Securities at that time may interfere
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<PAGE> 9
with an orderly sale and distribution of the securities being sold by the
Company in such offering or materially and adversely affect the price of such
securities; provided, however, that if an offering of some but not all of the
Registrable Securities requested to be registered by the Holders and all other
Persons having rights to include securities held by them in such registration
would not adversely affect the distribution or price of the securities to be
sold by the Company in the offering in the opinion of such firm or are included
in such offering notwithstanding any such opinion, the Company shall only
include such lesser amount of Registrable Securities and the aggregate number
of Registrable Securities to be included in such offering by each Holder shall
be allocated pro rata among the Holders requesting such registration on the
basis of the percentage of the Registrable Securities held by such Holders
which have requested that such Registrable Securities be included; and
(iii) The Company shall not be required to give notice of, or
effect any registration of Registrable Securities under this Article 3
incidental to, the registration of any of its securities in connection with
mergers, consolidations, acquisitions, exchange offers, subscription offers,
dividend reinvestment plans or stock options or other employee benefit or
compensation plans.
(b) No registration of Registrable Securities effected under this
Article 3 shall relieve the Company of its obligations (if any) to effect
registrations of Registrable Securities pursuant to Article 2.
4. HOLDBACKS AND OTHER RESTRICTIONS.
(a) Each Holder hereby covenants and agrees with the Company that:
(i) such Holder shall not, if requested by the managing
underwriters in an underwritten offering that includes such Holder's
Registrable Securities, effect any public sale or distribution of securities of
the Company of the same class as the securities included in such registration
statement (or convertible into such class), including a sale pursuant to Rule
144(k) under the Securities Act (except as part of such underwritten
registration): (A) during the ten (10) day period prior to, and during the
ninety 90-day period (or such longer period of not more than one hundred eighty
(180) days if such longer period is also required of the Company and all other
Persons having securities included in such registration) beginning on the
closing date of each underwritten offering made pursuant to such registration
statement, to the extent timely notified in writing by the Company or the
managing underwriters; and (B) in the event of a primary offering by the
Company, to the extent such Holder does not elect to sell such securities in
connection with such offering, during the period of distribution of the
Company's securities in such offering and during the period in which the
underwriting syndicate, if any, participates in the aftermarket. In any such
case the Company shall require the underwriters to notify the Company and the
Company, in turn, shall notify all Holders of Registrable Securities included
in the offering promptly after such participation ceases;
(ii) such Holder shall not, during any period in which any of
his or its Registrable Securities are included in any effective registration
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<PAGE> 10
statement: (A) effect any stabilization transactions or engage in any
stabilization activity in connection with the Common Stock or other equity
securities of the Company in contravention of Rule 10b-7 under the Exchange
Act; (B) permit any Affiliated Purchaser (as that term is defined in Rule 10b-6
under the Exchange Act) to bid for or purchase for any account in which such
Holder has a beneficial interest, or attempt to induce any other person to
purchase, any shares of Common Stock or Registrable Securities in contravention
of Rule 10b-6 under the Exchange Act; or (C) offer or agree to pay, directly
orindirectly, to anyone any compensation for soliciting another to purchase, or
for purchasing (other than for such Holder's own account), any securities of
the Company on a national securities exchange in contravention of Rule 10b-2
under the Exchange Act; and
(iii) such Holder shall, in the case of a registration
including Registrable Securities to be offered by it for sale through Brokers
Transactions furnish each broker through whom such Holder offers Registrable
Securities such number of copies of the prospectus as the broker may require
and otherwise comply with the prospectus delivery requirements under the
Securities Act.
(b) The Company covenants and agrees with the Holders not to effect
any public or private sale or distribution (other than distributions pursuant
to employee benefit plans) of its securities, including a sale pursuant to
Regulation D under the Securities Act (or Section 4(2) thereof), during the ten
(10) day period prior to, and during the ninety (90) day period beginning with,
the effectiveness of a Registration Statement filed under Section 2(a) hereof,
to the extent timely requested in writing by the managing underwriters, if any,
or, if there be none, by the Holders of a majority in aggregate amount of the
Registrable Securities included on such registration statement for such
registration, except pursuant to registrations on Form S-4, Form S-8 or any
successor form.
5. REGISTRATION PROCEDURES.
If and whenever the Company is required by the provisions of this
Agreement to use commercially reasonable best efforts to effect or cause a
registration as provided in this Agreement, the Company will:
(a) Use its commercially reasonable best efforts to prepare and file
with the SEC, a registration statement within the time periods specified
herein, and use its commercially reasonable best efforts to cause such
registration statement to become effective as promptly as practicable and to
remain effective under the Securities Act until (i) the Lapse Date with respect
to registrations pursuant to Section 2(b) and (ii) until the earlier of such
time as all securities covered thereby are no longer Registrable Securities or
one hundred and eighty (180) days after such registration statement becomes
effective with respect to registrations pursuant to Section 2(a), in every case
as any such period may be extended pursuant to Section 5(h) or Article 7
hereto.
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<PAGE> 11
(b) Prepare and file with the SEC such amendments, post-effective
amendments and supplements to such registration statement and the prospectus
used in connection therewith as may be necessary to keep such registration
statement effective for such period of time required by Section 5(a) above, as
such period may be extended pursuant to Section 5(h) or Article 7 hereto.
(c) Comply in all material respects with the provisions of the
Securities Act with respect to the disposition of all securities covered by
such registration statement during the period during which any such
registration statement is required to be effective.
(d) Furnish to any Holder and any underwriter of Registrable
Securities, (i) such number of copies (including manually executed and
conformed copies) of such registration statement and of each amendment thereof
and supplement thereto (including all annexes, appendices, schedules and
exhibits), (ii) such number of copies of the prospectus, used in connection
with such registration statement (including each preliminary prospectus, any
summary prospectus and the final prospectus), and (iii) such number of copies
of other documents, in each case as such Holder or such underwriter may
reasonably request.
(e) Use its commercially reasonable best efforts to register or
qualify all Registrable Securities covered by such registration statement under
the securities or "blue sky" laws of states of the United States as any Holder
or any underwriter shall reasonably request, and do any and all other acts and
things which may be reasonably requested by such Holder or such underwriter to
consummate the offering and disposition of Registrable Securities in such
jurisdictions; provided, however, that the Company shall not be required to
qualify generally to do business as a foreign corporation or as a dealer in
securities, subject itself to taxation, or consent to general service of
process in any jurisdiction wherein it is not then so qualified or subject.
(f) Use, as soon as practicable after the effectiveness of the
registration statement, commercially reasonable best efforts to cause the
Registrable Securities covered by such registration statement to be registered
with, or approved by, such other United States public, governmental or
regulatory authorities, if any, as may be required in connection with the
disposition of such Registrable Securities.
(g) Use its commercially reasonable best efforts to list the Common
Stock covered by such registration statement on any securities exchange (or if
applicable, The NASDAQ Stock Market) on which any securities of the Company is
then listed, if the listing of such Registrable Securities are then permitted
under the applicable rules of such exchange (or if applicable, The NASDAQ Stock
Market).
(h) Notify each Holder as promptly as practicable and, if requested
by any Holder, confirm such notification in writing, (i) when a prospectus or
any prospectus supplement has been filed with the SEC, and, with respect to a
registration statement or any post-effective amendment thereto, when the same
has been declared effective by the SEC, (ii) of the issuance by the SEC of any
<PAGE>
<PAGE> 12
stop order or the coming to the Company's attention of the initiation of any
proceedings for such or a similar purpose, (iii) of the receipt by the Company
of any notification with respect to the suspension of the qualification of any
of the Registrable Securities for sale in any jurisdiction or the initiation or
threatening of any proceeding for such purpose, (iv) of the occurrence of any
event which requires the making of any changes to a registration statement or
related prospectus so that such documents will not contain any untrue statement
of a material fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading (and the Company shall
promptly prepare and furnish to each Holder a reasonable number of copies of a
supplemented or amended prospectus such that, as thereafter delivered to the
purchasers of such Registrable Securities, such prospectus shall not include an
untrue statement of a material fact or omit to state a material fact required
to be stated therein or necessary to make the statements therein, in light of
the circumstances under which they are made, not misleading), and (v) of the
Company's determination that the filing of a post-effective amendment to the
Registration Statement shall be necessary or appropriate. Upon the receipt of
any notice from the Company of the occurrence of any event of the kind
described in clause (iv) or (v) of this Section 5(h), the Holders shall
forthwith discontinue any offer and disposition of Registrable Securities
pursuant to the registration statement covering such Registrable Securities
until all Holders shall have received copies of a supplemented or amended
prospectus which is no longer defective and, if so directed by the Company,
shall deliver to the Company, at the Company's expense, all copies (other than
permanent file copies) of the defective prospectus covering such Registrable
Securities which are then in the Holders' possession. If the Company shall
provide any notice of the type referred to in the preceding sentence, the
period during which the registration statements are required to be effective as
set forth under Section 5(a) shall be extended by the number of days from and
including the date such notice is provided, to and including the date when
Holders shall have received copies of the corrected prospectus.
(i) Enter into such agreements and take such other appropriate
actions as are customary and reasonably necessary to expedite or facilitate the
disposition of such Registrable Securities, and in that regard, deliver to the
Holders such documents and certificates as may be reasonably requested by any
Holder of the Registrable Securities being sold or, as applicable, the managing
underwriters, to evidence the Company's compliance with this Agreement
including, without limitation, using commercially reasonable best efforts to
cause its independent accountants to deliver to the Company's Board of Trustees
(and to the Holders of Registrable Securities being sold in any registration)
an accountants' comfort letter substantially similar to that in scope delivered
in an underwritten public offering and covering audited and interim financial
statements included in the registration statement or, if such letter can not be
obtained through the exercise of commercially reasonable best efforts, cause
its independent accountants to deliver to the Company's Board of Trustees (and
to the Holders of Registrable Securities being sold in any registration) a
comfort letter based on negotiated procedures providing comfort with respect to
the Company's financial statements included or incorporated by reference in the
registration statement at the highest level permitted to be given by such
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<PAGE> 13
accountants under the then applicable standards of the Association of
Independent Certified Accountants with respect to such registration
statement.In addition, the Company shall furnish to the Holders of Registrable
Securities being included in any registration hereunder an opinion of counsel
substantially identical in substance and scope to that customarily delivered to
underwriters in public offerings.
6. UNDERWRITING.
(a) If requested by the underwriters for any underwritten offering
of Registrable Securities pursuant to a registration hereunder, the Company
will enter into and perform its obligations under an underwriting agreement
with the underwriters for such offering, such agreement to contain such
representations and warranties by the Company and such other terms and
provisions as are customarily contained in underwriting agreements with respect
to secondary distributions, including, without limitation, customary provisions
relating to indemnities and contribution and the provision of opinions of
counsel and accountants' letters.
(b) If any registration pursuant to Article 3 hereof shall involve,
in whole or in part, an underwritten offering, the Company may require
Registrable Securities requested to be registered pursuant to Article 3 to be
included in such underwriting on the same terms and conditions as shall be
applicable to the securities being sold through underwriters under such
registration. In such case, each Holder requesting registration shall be a
party to any such underwriting agreement. Such agreement shall contain such
representations and warranties by the Holders requesting registration and such
other terms and provisions as are customarily contained in underwriting
agreements with respect to secondary distributions, including, without
limitation, provisions relating to indemnities and contribution.
(c) In any offering of Registrable Securities pursuant to a
registration hereunder, each Holder requesting registration shall also enter
into such additional or other agreements as may be customary in such
transactions, which agreements may contain, among other provisions, such
representations and warranties as the Company or the underwriters of such
offering may reasonably request (including, without limitation, those
concerning such Holder, its Registrable Securities, such Holder's intended plan
of distribution and any other information supplied by it to the Company for use
in such registration statement), and customary provisions relating to
indemnities and contribution.
7. INFORMATION BLACKOUT.
(a) At any time when a registration statement effected pursuant to
Sections 2(a), 2(b) or 3 relating to Registrable Securities is effective, upon
written notice from the Company to the Holders that the Company has determined
in good faith that sale of Registrable Securities pursuant to the registration
statement would require disclosure of non-public material information not
otherwise required to be disclosed under applicable law having a material
adverse effect on the Company (an "Information Blackout"), all Holders shall
<PAGE>
<PAGE> 14
suspend sales of Registrable Securities pursuant to such registration statement
until the earlier of:
(i) forty-five (45) days after the Company makes such good
faith determination, and
(ii) such time as the Company notifies the Holders that
such material information has been disclosed to the public or has
ceased to be material or that sales pursuant to such registration
statement may otherwise be resumed (the number of days from such
suspension of sales by the Holders until the day when such sale may
be resumed hereunder is hereinafter called a "Sales Blackout
Period").
(b) Any delivery by the Company of notice of an Information Blackout
during the forty-five (45) days immediately following effectiveness of any
registration statement effected pursuant to Section 2(a) hereof shall give the
Holders of a majority in aggregate amount of Registrable Securities being sold
the right, by written notice to the Company within twenty (20) Business Days
after the end of such Sales Blackout Period, to cancel such registration, in
which event the Holders shall have one additional registration right under the
Section pursuant to which such registration was filed in such fiscal year (a
"Blackout Termination Right").
(c) If there is an Information Blackout and the cancellation right,
if any, pursuant to (b) above, is not available or exercised, the time period
set forth in clause (ii) of Section 5(a) shall be extended for a number of days
equal to the number of days in the Sales Blackout Period.
(d) Notwithstanding the foregoing, there shall be no more than two
(2) Information Blackouts during the term of this Agreement and no Sales
Blackout Period shall continue for more than forty-five (45) consecutive days.
8. RULE 144.
The Company shall use commercially reasonable best efforts to take
all actions necessary to comply with the filing requirements described in Rule
144(c)(1) or any successor thereto so as to enable the Holders to sell
Registrable Securities without registration under the Securities Act. Upon the
written request of any Holder, the Company will deliver to such Holder a
written statement as to whether it has complied with the filing requirements
under Rule 144(c)(1) or any successor thereto.
9. PREPARATION; REASONABLE INVESTIGATION; INFORMATION.
In connection with the preparation and filing of each registration
statement registering Registrable Securities under the Securities Act, (a) the
Company will give the Holders and the underwriters, if any, and their
respective counsel and accountants, drafts of such registration statement for
their review and comment prior to filing and (during normal business hours and
subject to such reasonable limitations as the Company may impose to prevent
<PAGE>
<PAGE> 15
disruption of its business) such reasonable and customary access to its books
and records and such opportunities to discuss the business of the Company with
its officers and the independent public accountants who have certified its
financial statements as shall be necessary, in the reasonable opinion of the
Holders of a majority in aggregate amount of the Registrable Securities being
registered and such underwriters or their respective counsel, to conduct a
reasonable investigation within the meaning of the Securities Act and (b) as a
condition precedent to including any Registrable Securities of any Holder in
any such registration, the Company may require such Holder to furnish the
Company such information regarding such Holder and the distribution of such
securities as the Company may from time to time reasonably request in writing
or as shall be required by law or the SEC in connection with any registration;
provided, however, that, upon the reasonable request of the supplier of any
such information, the recipient thereof shall enter into a confidentiality
agreement respecting such information in customary form for an underwritten
public offering.
10. INDEMNIFICATION AND CONTRIBUTION.
(a) In the case of each offering of Registrable Securities made
pursuant to this Agreement, the Company shall indemnify and hold harmless each
Holder, its officers, directors and trustees, each underwriter of Registrable
Securities so offered and each Person, if any, who controls any of the
foregoing Persons within the meaning of the Securities Act ("Holder
Indemnitees"), from and against any and all claims, liabilities, losses,
damages, expenses and judgments, joint or several, to which they or any of them
may become subject, under the Securities Act or otherwise, including any amount
paid in settlement of any litigation commenced or threatened, and shall
promptly reimburse them, as and when incurred, for any legal or other expenses
incurred by them in connection with investigating any claims and defending any
actions, insofar as such losses, claims, damages, liabilities or actions shall
arise out of, or shall be based upon, any violation or alleged violation by the
Company of the Securities Act, or relating to action taken or action or
inaction required of the Company in connection with such offering, or shall
arise out of, or shall be based upon, any untrue statement or alleged untrue
statement of a material fact contained in the registration statement (or in any
preliminary or final prospectus included therein) relating to the offering and
sale of such Registrable Securities, or any amendment thereof or supplement
thereto, or in any document incorporated by reference therein, or any omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading; provided,
that the Company shall not be liable to any Holder Indemnitee in any such case
to the extent that any such loss, claim, damage, liability or action arises out
of, or is based upon, any untrue statement or alleged untrue statement, or any
omission, if such statement or omission shall have been made in reliance upon
and in conformity with information furnished to the Company in writing by or on
behalf of such Holder specifically for use in the preparation of the
registration statement (or in any preliminary or final prospectus included
therein), or any amendment thereof or supplement thereto. Such indemnity shall
remain in full force and effect regardless of any investigation made by or on
behalf of any Holder and shall survive the transfer of such securities. The
<PAGE>
<PAGE> 16
foregoing indemnity agreement is in addition to any liability which the Company
may otherwise have to any Holder Indemnitee.
(b) In the case of each offering of Registrable Securities made
pursuant to this Agreement, each Holder, severally and not jointly, shall
indemnify and hold harmless the Company, its officers and trustees, and each
Person, if any, who controls any of the foregoing within the meaning of the
Securities Act and (if requested by the underwriters) each underwriter who
participates in the offering and each Person, if any, who controls any such
underwriter within the meaning of the Securities Act (the "Company
Indemnitees"), from and against any and all claims, liabilities, losses,
damages, expenses and judgments, joint or several, to which they or any of them
may become subject, under the Securities Act or otherwise, including any amount
paid in settlement of any litigation commenced or threatened, and shall
promptly reimburse them, as and when incurred, for any legal or other expenses
incurred by them in connection with investigating any claims and defending any
actions, insofar as any such losses, claims, damages, liabilities or actions
shall arise out of, or shall be based upon, any violation or alleged violation
by such Holder of the Securities Act, any blue sky laws, securities laws or
other applicable laws of any state or country in which the Registrable
Securities are offered and relating to action taken or action or inaction
required of such Holder in connection with such offering, or shall arise out
of, or shall be based upon, any untrue statement or alleged untrue statement of
a material fact contained in the registration statement (or in any preliminary
or final prospectus included therein) relating to the offering and sale of such
Registrable Securities or any amendment thereof or supplement thereto, or any
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, but
in each case only to the extent that such untrue statement is contained in, or
such fact is omitted from, information furnished in writing to the Company by
or on behalf of such Holder specifically for use in the preparation of such
registration statement (or in any preliminary or final prospectus included
therein). The liability of each Holder under such indemnity provision shall be
limited to an amount equal to the total net proceeds received by such Holder
from such offering. Such indemnity shall remain in full force and effect
regardless of any investigation made by or on behalf of the Company and shall
survive the transfer of such securities. The foregoing indemnity is in
addition to any liability which Holder may otherwise have to any Company
Indemnitee.
(c) In case any proceeding (including any governmental
investigation) shall be instituted involving any Person in respect of which
indemnity may be sought pursuant to this Article 10, such Person (the
"indemnified party") shall promptly notify the Person against whom such
indemnity may be sought (the "indemnifying party") in writing. No
indemnification provided for in Section 10(a) or (b) shall be available to any
person who shall fail to give notice as provided in this Section 10(c) if the
indemnifying party to whom notice was not given was unaware of the proceeding
to which such notice would have related and was prejudiced by the failure to
give such notice, but the failure to give such notice shall not relieve the
indemnifying party or parties from any liability which it or they may have to
<PAGE>
<PAGE> 17
the indemnified party for contribution or otherwise than on account of the
provisions of Section 10(a) or (b). In case any such proceeding shall be
brought against any indemnified party and it shall notify the indemnifying
party of the commencement thereof, the indemnifying party shall be entitled to
participate therein and, to the extent that it shall wish, jointly with any
other indemnifying party similarly notified, to assume the defense thereof,
with counsel reasonably satisfactory to such indemnified party and shall pay as
incurred the fees and disbursements of such counsel related to such
proceeding.In any such proceeding, any indemnified party shall have the right
to retain its own counsel at its own expense. Notwithstanding the foregoing,
the indemnifying party shall pay as incurred the fees and expenses of the
counsel retained by the indemnified party in the event (i) the indemnifying
party and the indemnified party shall have mutually agreed to the retention of
such counsel or (ii) the named parties to any such proceeding (including any
impleaded parties) include both the indemnifying party and the indemnified
party and representation of both parties by the same counsel, in the written
opinion of such counsel, would be inappropriate due to actual or potential
differing interests between them. It is understood that the indemnifying party
shall not, in connection with any proceeding or related proceedings in the same
jurisdiction, be liable for the reasonable fees and expenses of more than one
separate firm for all such indemnified parties. Such firm shall be designated
in writing by the Holders of a majority in aggregate Fair Market Value of the
then Outstanding Registrable Securities in the case of parties indemnified
pursuant to Section 10(a) and by the Company in the case of parties indemnified
pursuant to Section 10(b). The indemnifying party shall not be liable for any
settlement of any proceeding effected without its written consent but if
settled with such consent or if there be a final judgement for the plaintiff,
the indemnifying party agrees to indemnify the indemnified party from and
against any loss or liability by reason of such settlement or judgment.
(d) If the indemnification provided for in this Article 10 is
unavailable to or insufficient to hold harmless an indemnified party under
Section 10(a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions or proceedings in respect thereof) referred to therein,
or if the indemnified party failed to give the notice required under Section
10(c) above, then each indemnifying party shall contribute to the amount paid
or payable by the indemnified party as a result of such losses, claims, damages
or liabilities (or actions or proceedings in respect thereof) in proportion as
is appropriate to reflect not only both the relative benefits received by such
party (as compared to the benefits received by all other parties) from the
offering in respect of which indemnity is sought, but also the relative fault
of all parties in connection with the statements or omissions which resulted in
such losses, claims, damages or liabilities (or actions or proceedings in
respect thereof), as well as any other relevant equitable considerations. The
relative benefits received by a party shall be deemed to be in the same
proportion as the total net proceeds from the offering (before deducting
expenses) received by it bear to the total amounts (including, in the case of
any underwriter, underwriting commission and discounts) received by each other
party. Relative fault shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
<PAGE>
<PAGE> 18
supplied by the party and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The parties agree that it would not be just and equitable if
contributions pursuant to this Section 10(d) 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 10(d). The
amount paid or payable by an indemnified party as a result of the losses,
claims, damages or liabilities (or actions or proceedings in respect thereof)
referred to above shall be deemed to include any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending any such action or claim. Notwithstanding the provisions of this
subsection (d), no person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation.
(e) The indemnity provided for hereunder shall not inure to the
benefit of any indemnified party to the extent that such indemnified party
failed to comply with the applicable prospectus delivery requirements of the
Securities Act as then applicable to the person asserting the loss, claim,
damage or liability for which indemnity is sought.
11. EXPENSES.
In connection with any registration under this Agreement, the Company
shall pay all Registration Expenses. In addition, in connection with each
registration, the Company shall pay the reasonable fees and expenses of one
counsel to represent the interests of the Holders selling Registrable
Securities in such registration. Notwithstanding the foregoing, in the event
that any Holder or Holders require the Company to conduct an underwritten
public offering of Registrable Securities pursuant to Section 2(a) prior to 12
months after the date hereof, each such Holder or Holders shall pay its pro
rata share of all Registration Expenses.
12. NOTICES.
Except as otherwise provided below, whenever it is provided in this
Agreement that any notice, demand, request, consent, approval, declaration or
other communication shall or may be given to or served upon any of the parties
hereto, or whenever any of the parties hereto, desires to provide to or serve
upon the other party any other communication with respect to this Agreement,
each such notice, demand, request, consent, approval, declaration or other
communication shall be in writing and shall be delivered in person, mailed by
registered or certified mail (return receipt requested) or sent by overnight
courier service or via facsimile transmission (which is confirmed), as
follows:(a) if to a Holder, at the most current address given by such Holder to
the Company by means of a notice given in accordance with the provisions of
this Section 12, which address initially is, with respect to: (i) SSI, the
address set forth in the SSI Agreement, (ii) TNC, the address set forth in the
Agreement of Limited Partnership for the Partnership, (iii) TVF XIII, 7001
<PAGE>
<PAGE> 19
Center Street, Mentor, Ohio 44060, facsimile number (216) 255-8645, (iv) all
other holders, the address set forth in the register for the applicable
security; and (b) if to the Company, initially at the address set forth in the
SSI Agreement and thereafter at such other address, notice of which is given in
accordance with the provisions of this Section 12. The furnishing of any
notice required hereunder may be waived in writing by the party entitled to
receive such notice. Every notice, demand, request, consent, approval,
declaration or other communication hereunder shall be deemed to have been duly
furnished or served on the party to which it is addressed, in the case of
delivery in person or by facsimile, on the date when sent (with receipt
personally acknowledged in the case of telecopied notice), in the case of
overnight mail, on the day after it is sent and in all other cases, five
business days after it is sent. Failure or delay in delivering copies of any
notice, demand, request, consent, approval, declaration or other communication
to the persons designated above to receive copies shall in no way adversely
affect the effectiveness of such notice, demand, request, consent, approval,
declaration or other communication.
13. ENTIRE AGREEMENT.
This Agreement represents the entire agreement and understanding
among the parties hereto with respect to the subject matter hereof and
supersedes any and all prior oral and written agreements, arrangements and
understandings among the parties hereto with respect to such subject matter;
and this Agreement can be amended, supplemented or changed, and any provision
hereof can be waived or a departure from any provision hereof can be consented
to, only by a written instrument making specific reference to this Agreement
signed by the Company and the Holders of at least 80% of the Registrable
Securities then outstanding; provided that any amendment that adversely affects
the rights of any Holder must be signed by the adversely affected Holder;
provided further that any waiver must be signed by the party entitled to the
benefit of the term or matter being waived.
14. PARAGRAPH HEADINGS.
The paragraph headings contained in this Agreement are for general
reference purposes only and shall not affect in any manner the meaning,
interpretation or construction of the terms or other provisions of this
Agreement.
15. APPLICABLE LAW.
This Agreement shall be governed by, construed and enforced in
accordance with the laws of the Commonwealth of Pennsylvania applicable to
contracts to be made, executed, delivered and performed wholly within such
state and, in any case, without regard to the conflicts of law principles of
such state.
16. SEVERABILITY.
If at any time subsequent to the date hereof, any provision of this
Agreement shall be held by any court of competent jurisdiction to be illegal,
<PAGE>
<PAGE> 20
void or unenforceable, such provision shall be of no force and effect, but the
illegality or unenforceability of such provision shall have no effect upon and
shall not impair the enforceability of any other provision of this Agreement.
17. EQUITABLE REMEDIES.
The parties hereto agree that irreparable harm would occur in the
event that any of the agreements and provisions of this Agreement were not
performed fully by the parties hereto in accordance with their specific terms
or conditions or were otherwise breached, and that money damages are an
inadequate remedy for breach of this Agreement because of the difficulty of
ascertaining and quantifying the amount of damage that will be suffered by the
parties hereto in the event that this Agreement is not performed in accordance
with its terms or conditions or is otherwise breached. It is accordingly
hereby agreed that the parties hereto shall be entitled to an injunction or
injunctions to restrain, enjoin and prevent breaches of this Agreement by the
other parties and to enforce specifically the terms and provisions hereof in
any court of the United States or any state having jurisdiction, such remedy
being in addition to and not in lieu of, any other rights and remedies to which
the other parties are entitled to at law or in equity.
18. NO WAIVER.
The failure of any party at any time or times to require performance
of any provision hereof shall not affect the right at a later time to enforce
the same. No waiver by any party of any condition, and no breach of any
provision, term, covenant, representation or warranty contained in this
Agreement, whether by conduct or otherwise, in any one or more instances, shall
be deemed to be construed as a further or continuing waiver of any such
condition or of the breach of any other provision, term, covenant,
representation or warranty of this Agreement.
19. COUNTERPARTS.
This Agreement may be executed in two or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute
but one and the same original instrument.
20. THIRD PARTY BENEFICIARIES; SUCCESSORS AND ASSIGNS.
The Other Purchasers shall be third party beneficiaries of this
Agreement. This Agreement shall inure to the benefit of and be binding upon
the successors, assigns and transferees of each of the parties hereto and of
each of the Other Purchasers, including, without limitation and without the
need for an express assignment, subsequent Holders; provided that nothing
herein shall be deemed to permit any assignment, transfer or other disposition
of Registrable Securities in violation of the terms of the SSI Agreement, the
Warrant, the Units, the Agreement of Limited Partnership of the Partnership or
applicable law. If any transferee of any Holder shall acquire Registrable
Securities, in any manner, whether by operation of law or otherwise, such
Registerable Securities shall be held subject to all of the terms of this
<PAGE>
<PAGE> 21
Agreement, and by taking and holding such Registrable Securities such person
shall be conclusively deemed to have agreed to be bound by and to perform all
of the terms and provisions of this Agreement.
21. NON-RECOURSE.
No recourse shall be had for any obligation of the Company hereunder,
or for any claim based thereon or otherwise in respect thereof, against any
past, present or future trustee, shareholder, officer or employee of the
Company, whether by virtue of any statute or rule of law, or by the enforcement
of any assessment or penalty or otherwise, all such other liability being
expressly waived and released by each other party hereto.
IN WITNESS WHEREOF, this Agreement has been executed and delivered as
of the date first above written.
BRANDYWINE REALTY TRUST
By:
Title:
SAFEGUARD SCIENTIFICS
(DELAWARE), INC.
By:
Title:
THE NICHOLS COMPANY
By:
Title:
TURKEY VULTURE FUND XIII, LTD.
By:
<PAGE>
<PAGE> 22
Schedule A
OTHER PURCHASERS
Brian F. Belcher
Jack R. Loew
Craig C. Hough
RDC Institute, Inc.
Gary C. Bender
Lotz Designers Engineers and Constructors, Inc.
Werner A. Fricker
C/N Oaklands III, Inc.**
Iron Run V, Inc.**
C/N Iron Run III, Inc.**
C/N Leedom II, Inc.*
________________________
* Wholly-owned subsidiary of Safeguard Scientifics, Inc.
** Wholly-owned subsidiary of The Nichols Company.
<PAGE>
EXHIBIT 7.9
AGREEMENT OF JOINT FILING
Pursuant to Rule 13d-1(f) promulgated under the Securities Exchange Act of
1934, as amended, the undersigned persons hereby agree to file with the
Securities and Exchange Commission, the Statement on Schedule 13D (the
"Statement") to which this Agreement is attached as an exhibit, and agree that
such Statement, as so filed, is filed on behalf of each of them.
This Agreement may be executed in counterparts, each of which when so
executed shall be deemed to be an original, and all of which together shall be
deemed to constitute one and the same instrument.
IN WITNESS WHEREOF, the undersigned have executed this Agreement.
Dated: June 21, 1996 TURKEY VULTURE FUND XIII, LTD.
By: /s/ Richard M. Osborne
Richard M. Osborne
Manager
THE RICHARD M. OSBORNE TRUST
By: /s/ Richard M. Osborne
Richard M. Osborne
Trustee
