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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of Report: March 4, 1997
(Date of earliest event reported)
LTC PROPERTIES, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 1-11314 71-0720518
(State or other jurisdiction of (Commission File Number) (I.R.S. Employer
incorporation or organization) Identification No.)
300 ESPLANADE DRIVE, SUITE 1860
OXNARD, CALIFORNIA 93030
(Address of principal executive offices, including zip code)
(805) 981-8655
(Registrant's telephone number, including area code)
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ITEM 5. OTHER EVENTS
The Company entered into an Underwriting Agreement dated March 4, 1997,
between Company and Morgan Keegan & Company, Inc. as Representatives of the
several underwriters, as defined therein, relating to the offering of 3,080,000
shares of 9.5% Series A Cumulative Preferred Stock (Liquidation Preference $25
Per Share), par value $.01 per share attached hereto as Exhibit 1.1.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(c) Exhibits
1.1 Underwriting Agreement
12 Statement re computation of ratios
2
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
LTC PROPERTIES, INC.
Date: March 7, 1997 By /s/ JAMES J. PIECZYNSKI
--------------------------------
James J. Pieczynski
Senior Vice President and
Chief Financial Officer
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EXHIBIT 1.1
LTC PROPERTIES, INC.
3,080,000 SHARES
9.5% SERIES A CUMULATIVE PREFERRED STOCK
($.01 PAR VALUE)
UNDERWRITING AGREEMENT
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March 4, 1997
Morgan Keegan & Company, Inc.
J.C. Bradford & Co.
Crowell, Weedon & Co.
Sutro & Co. Incorporated
As Representatives of the Underwriters
c/o Morgan Keegan & Company, Inc.
50 Front Street
Memphis, TN 38103
Dear Sirs:
LTC Properties, Inc., a Maryland corporation (the "Company"), proposes to
issue and sell to the several Underwriters named in Schedule A hereto (the
"Underwriters"), acting through Morgan Keegan & Company, Inc., J.C. Bradford &
Co., Crowell, Weedon & Co. and Sutro & Co. Incorporated as duly authorized
representatives of the Underwriters (the "Representatives"), an aggregate of
3,080,000 shares of the 9.5% Series A Cumulative Preferred Stock, $.01 par value
(the "Preferred Stock") of the Company (the "Shares"). The Shares are to be
sold to each Underwriter, acting severally and not jointly, in such amounts as
are set forth in Schedule A opposite the name of each Underwriter.
Section 1. Representations and Warranties of the Company. The Company
represents and warrants to and agrees with each of the Underwriters that:
(a) The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3 (Registration No. 333-2444),
including the related prospectus included in the registration statement, which
has been declared effective by the Commission, for the registration under the
Securities Act of 1933 (the "1933 Act"), as amended, and the rules and
regulations promulgated thereunder (the "1933 Act Rules"), of the offer and sale
of up to $125,000,000 aggregate issue price of securities, including the Shares.
No stop order suspending the effectiveness of the Registration Statement has
been issued and no proceeding for that purpose has been instituted or, to the
knowledge of the Company, threatened by the Commission. The Company will
promptly file with the Commission a supplement to the form of prospectus
included in the registration statement specifically relating to the offer and
sale of the Preferred Stock pursuant to Rule 424 of the 1933 Act Rules.
The term "Registration Statement" means the registration statement
described above (as amended, if applicable, and including, without limitation,
any post-effective amendment that shall be declared effective prior to the
Closing Time (as defined herein)), as of the time it became effective (the
"Effective Time"), including all financial statements and schedules and other
documents and all exhibits included therein or incorporated therein by
reference. The term "Preliminary Prospectus" means any preliminary prospectus
supplement describing the Shares and the form of base prospectus included in the
Registration Statement at the Effective Time and each document incorporated
therein by reference. The term "Prospectus" means the final prospectus
supplement
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relating to the Shares, accompanied by such base prospectus, in the form in
which it is filed with the Commission after the time of execution and delivery
of this Agreement (the "Execution Time") pursuant to Rule 424(b) of the 1933 Act
Rules and each document incorporated therein by reference.
(b) No order preventing or suspending the use of any Preliminary
Prospectus has been issued by the Commission and no proceeding for that purpose
have been instituted or threatened by the Commission, and each Preliminary
Prospectus, at the time of filing thereof, conformed in all material respects to
the requirements of the 1933 Act and the 1933 Act Regulations and did not
contain any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein, in
the light of the circumstances under which they were made, not misleading;
provided, however, that this representation and warranty shall not apply to
untrue statements or omissions of material facts to the extent they are
corrected in the Prospectus first filed pursuant to Rule 424(b) under the 1933
Act Regulations, or to any statements or omissions made in reliance upon and in
conformity with information furnished in writing to the Company by an
Underwriter expressly for use in the Registration Statement.
(c) When the Registration Statement or any post-effective amendment
thereto was declared effective and as of the Effective Time, the Registration
Statement (i) complied, complies and will comply, as the case may be, in all
material respects with said rule; (ii) contained, contains or will contain, as
the case may be, all statements required to be stated therein in accordance
with, and complied, complies and will comply in all material respects with the
requirements of, the 1933 Act, the 1933 Act Rules, the Securities Exchange Act
of 1934, as amended (the "1934 Act") and the rules and regulations of the
Commission promulgated thereunder (the "1934 Act Rules"); and (iii) did not,
does not and will not, as the case may be, include any untrue statement of a
material fact or omit to state any material fact required to be stated therein
or necessary in order to make the statements therein not misleading. As of the
Effective Time, when the Prospectus is filed with the Commission pursuant to
Rule 424(b) of the 1933 Act Rules, on the issue date of the Prospectus and at
each Closing Time, the Prospectus (as supplemented as of any such time) (1)
complies and will comply in all material respects with the requirements of the
1933 Act, the 1933 Act Rules, the 1934 Act and the 1934 Act Rules and (2) does
not and will not, as the case may be, include any untrue statement of a material
fact or omit to state any 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. The provisions of
this paragraph (c) shall not apply to any statement or omission based upon
information relating to any Underwriter furnished in writing to the Company by
such Underwriter expressly for use in the Registration Statement.
(d) Each document incorporated by reference in the Registration Statement
(an "Incorporated Document"), as of the date such Incorporated Document was or
is filed with the Commission, conformed or will conform, as the case may be, in
all material respects to the requirements of the 1934 Act and the 1934 Act
Rules, and when read together with the other information in the Preliminary
Prospectus or Prospectus, as applicable, as of the Execution Time, and when the
Prospectus is filed with the Commission pursuant to Rule 424(b) of the 1933 Act
Rules, on the date when the Prospectus is otherwise supplemented, and at each
Closing Time, does not and will not, as the case may be, include any untrue
statement of a material fact or omit to state any material fact required to be
stated therein or necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading.
(e) The Company is a corporation duly organized, validly existing and in
good standing under the laws of the State of Maryland. Each of the subsidiaries
of the Company (the "Subsidiaries") has been duly organized and is validly
existing in good standing under the laws of its jurisdiction of organization;
and each of the Company and its Subsidiaries is duly qualified to transact
business and is in good standing as a foreign corporation in each other
jurisdiction in which the ownership, leasing, licensing or operation of its
properties or the nature or conduct of its business requires such qualification,
except where the failure to do so would not have a material adverse effect on
the assets, properties, results of operations or financial condition of the
Company and its Subsidiaries, taken as a whole (a "Material Adverse Effect").
The Company and each of its Subsidiaries has full power (corporate and other) to
own or lease their respective properties and conduct their respective businesses
as described in the Registration Statement and Prospectus.
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(f) The Company has full legal right, power and authority to enter into
this Agreement, to issue, sell and deliver the Shares as provided herein and to
consummate the transactions contemplated herein. This Agreement has been duly
authorized, executed and delivered by the Company and constitutes the valid and
binding agreement of the Company, enforceable against the Company in accordance
with its terms, except to the extent that enforceability may be limited by
bankruptcy, reorganization, moratorium or similar laws affecting the
enforceability of creditors' rights generally and rules of law governing
specific performance, injunctive relief and other equitable remedies and except
to the extent the indemnification provisions set forth in Section 7 of this
Agreement may be limited by federal and state securities laws or the public
policy underlying such laws.
(g) Each consent, approval, authorization, order, designation or filing by
or with any governmental agency or body necessary for the valid authorization,
issuance, sale and delivery of the Shares, the execution, delivery and
performance of this Agreement by the Company and the consummation by the Company
of the transactions contemplated hereby, has been made or obtained and is in
full force and effect. Neither the issuance, sale and delivery of the Shares
nor the execution, delivery and performance of this Agreement by the Company,
nor the consummation by the Company of the transactions contemplated hereby,
will result in a breach or violation of any of the terms and provisions of, or
constitute a default by the Company, under the Articles of Incorporation or
Bylaws of the Company, or will result in a breach or violation of any of the
terms or provisions of, or constitute default by the Company under, any
indenture, mortgage, deed of trust, loan agreement, note, lease or other
agreement or instrument to which the Company is a party or to which it or its
properties is subject, or of any statute, judgment, decree, order, rule or
regulation of any court or governmental agency or body applicable to the Company
or any of its properties, except for any such breach, violation or default as
would not result in a Material Adverse Effect.
(h) The Company has an authorized, issued and outstanding capitalization
as set forth in the Prospectus under the caption "Capitalization" as of the date
therein. All of the issued and outstanding shares of capital stock of the
Company, have been duly authorized and validly issued, are fully paid and
nonassessable. None of the issued shares of capital stock of the Company have
been issued in violation of any preemptive or similar right. Except as
disclosed in the Prospectus, there is no outstanding option, warrant or other
right calling for the issuance of, and no commitment, plan or arrangement to
issue, any shares of capital stock of the Company or any security convertible
into or exchangeable for capital stock of the Company. No holder of outstanding
shares of capital stock of the Company is entitled as such to any preemptive or
other right to subscribe for any of the Shares. No person or entity holds a
right to require or participate in the registration under the 1933 Act of the
Shares or any other security of the Company.
(i) The shares of capital stock of the Company, including the Preferred
Stock, conform to the descriptions thereof contained or incorporated by
reference in the Prospectus and the rights set forth in the instruments defining
the same.
(j) The financial statements of the Company and its consolidated
subsidiaries (including the related notes and schedules) incorporated by
reference into the Registration Statement and the Prospectus present fairly the
financial position of the Company and its consolidated subsidiaries as of the
dates indicated and the results of operations, changes in stockholders' equity
and cash flows thereof for the periods specified. Such financial statements and
schedules have been prepared in conformity with generally accepted accounting
principles applied on a consistent basis throughout the periods involved. The
supporting schedules included in the Registration Statement and the amounts in
the Prospectus under the captions "Prospectus Summary -- Summary Financial Data"
and "Selected Financial Data" fairly present the information shown therein and
have been determined on a basis consistent with the financial statements
incorporated by reference in the Registration Statement and the Prospectus.
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(k) Ernst & Young LLP, who has audited certain financial statements of the
Company and its consolidated subsidiaries and delivered its report with respect
to the audited consolidated financial statements and schedules incorporated by
reference in the Registration Statement and the Prospectus, are, and were during
the periods covered by their reports, independent public accountants with
respect to the Company as required by the 1933 Act, the 1934 Act, the 1933 Act
Regulations and the 1934 Act Regulations.
(l) Neither the Company, any of its Subsidiaries nor any of the properties
owned by them has sustained, since December 31, 1996, any material loss or
interference with its business from fire, explosion, flood, hurricane, accident
or other calamity, whether or not covered by insurance, or from any labor
dispute or arbitrators' or court or governmental action, order or decree, other
than as set forth or contemplated in the Prospectus; and, since the respective
dates as of which information is given in the Registration Statement and the
Prospectus, and except as otherwise stated in the Registration Statement and
Prospectus, there has not been (i) any material change in the capital stock,
long-term debt, obligations under capital leases or short-term borrowings of the
Company and its Subsidiaries; (ii) any Material Adverse Effect, or any
development which is reasonably likely to involve a prospective Material Adverse
Effect; (iii) any liability or obligation, direct or contingent, incurred or
undertaken by the Company which is material to the business or condition
(financial or other) of the Company and its Subsidiaries or any property owned
by them, taken as a whole, except for liabilities or obligations incurred in the
ordinary course of business; (iv) any declaration or payment of any dividend or
distribution of any kind on or with respect to the capital stock of the Company
other than normal periodic dividends; or (v) any transaction that is material to
the Company and its Subsidiaries, taken as a whole except transactions in the
ordinary course of business.
(m) The Company is not in violation of its Articles of Incorporation or
Bylaws; and, as of the Execution Time, no default exists, and no event has
occurred, nor state of facts exists, which, with notice or after the lapse of
time to cure or both, would constitute a default in the due performance and
observance of any obligation, agreement, covenant, consideration or condition
contained in any indenture, mortgage, deed of trust, loan agreement, note, lease
or other agreement or instrument to which the Company is a party or by which it
or any of its properties is subject, and no violation exists of any law, order,
rule, regulation, writ, injunction or decree of any government, governmental
instrumentality or court, domestic or foreign, in any such case where the
consequences of such violation or default would have a Material Adverse Effect.
(n) To the best of the Company's knowledge and except as otherwise
disclosed in the Prospectus, (i) neither the Company nor any of its Subsidiaries
has authorized or conducted nor has knowledge of the generation, transportation,
storage, presence, use, treatment, disposal, release or handling of (in an
amount or of a type that has been or must be reported to any governmental
agency, violates any Environmental Law (as defined below), or has required or
could require material remediation expenditures) any medical waste, hazardous
substance, asbestos, radon, polychlorinated biphenyls ("PCBs"), petroleum
product or waste (including crude oil or any fraction thereof), natural gas,
liquefied gas, synthetic gas or other material defined, regulated, controlled or
potentially subject to any remediation requirement under any Environmental Law
(collectively, "Hazardous Materials"), on, in or under any real property owned,
leased or by any means controlled by the Company or any of its Subsidiaries
except such as would not result in a Material Adverse Effect, (ii) the Company
and its Subsidiaries are in compliance with all federal, state and local laws,
ordinances, rules, regulations and other governmental requirements relating to
pollution, control of chemicals, management of waste, discharges of materials
into the environment, health, safety, natural resources, and the environment
(collectively, "Environmental Laws") except for such as would not result in a
Material Adverse Effect, and (iii) the Company and its Subsidiaries have, and
are in compliance with, all licenses, permits, registrations and government
authorizations necessary to operate under all applicable Environmental Laws
except for such as would not result in a Material Adverse Effect. Except as
otherwise disclosed in the Prospectus, neither the Company nor any of its
Subsidiaries has received any written or oral notice from any governmental
entity or any other person, and there is no pending or threatened claim,
litigation or any administrative agency proceeding that: alleges a violation of
any
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Environmental Laws by the Company; alleges the Company is a liable party or a
potentially responsible party under the Comprehensive Environmental Response,
Compensation and Liability Act, 42 U.S.C. (S) 9601, et seq., or any state
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superfund law; has resulted in or could result in the attachment of an
environmental lien on any real property owned, leased or controlled by the
Company or any Subsidiary; or alleges the occurrence of contamination of any of
such real property, damage to natural resources, property damage, or personal
injury based on their activities or the activities of their predecessors or
third parties (whether at the real property or elsewhere) involving Hazardous
Materials, whether arising under the Environmental Laws, common law principles,
or other legal standards.
(o) The Company and its Subsidiaries have good and marketable title in fee
simple to, or a lawful first priority mortgage or deed of trust on, each real
property or interest in real property described in the Prospectus (including the
documents incorporated by reference therein). With respect to each such
property described in the Prospectus as owned by them, the Company or a
Subsidiary owns such property free and clear of all liens, encumbrances, claims,
security interests, restrictions and defects except such as are described in the
Prospectus or such as do not materially adversely affect the value of such
property or interests or interfere with the use made or proposed to be made of
such property or interests by the Company and each of its Subsidiaries. Each
parcel of real property owned, leased or controlled by or pledged as collateral
to the Company and each improvement thereon complies with all applicable codes,
laws and regulations (including, without limitation, licensing codes and laws,
certificate of need statutes, building and zoning codes, laws and regulations
and laws relating to access to facilities located on such real property) except
as otherwise disclosed in the Prospectus and except for such failures to comply
that would not individually or in the aggregate have a Material Adverse Effect.
The Company has no knowledge of any pending or threatened proceeding to revoke
or withdraw any facility license or certificate of need, condemnation
proceeding, zoning change, or other proceeding or action that will in any manner
affect the size of, use of, improvements on, construction on or access to any
such real property or improvements, except such proceedings or actions that
would not have a Material Adverse Effect.
(p) Any real property and buildings held under lease by the Company or its
Subsidiaries are held by the Company or such Subsidiaries under valid, binding
and enforceable leases conforming to any applicable description thereof set
forth in or the documents incorporated by reference into the Registration
Statement and the Prospectus, with such exceptions as do not interfere in any
material respect with the use made and proposed to be made of such property and
buildings by the Company, its Subsidiaries or any third party.
(q) No legal or governmental proceedings are pending to which the Company
or any of its Subsidiaries is a party or to which the property of the Company or
any of its Subsidiaries is subject that are required to be described in the
Registration Statement or the Prospectus and are not described therein, and no
such proceedings have been threatened against the Company or any of its
Subsidiaries or with respect to any of their respective properties.
(r) There are no contracts or other documents required by the 1933 Act or
the 1933 Act Regulations to be described in the Prospectus or to be filed as
exhibits to the Registration Statement which have not been accurately described
in all material respects or filed as required.
(s) The Company and its Subsidiaries own, possess or have obtained all
material permits, licenses, franchises, certificates, consents, orders,
approvals and other authorizations of governmental or regulatory authorities as
are necessary to own or lease, as the case may be, and to operate their
properties and to carry on their businesses as presently conducted. The Company
has not received any notice of proceedings relating to revocation or
modification of any such license, permit, certificate, consent, order, approval
or authorization which revocation or modification would result in a Material
Adverse Effect.
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(t) The Company has filed on a timely basis all federal, state, local and
foreign income and franchise tax returns required to be filed through the date
hereof and has paid all taxes shown as due thereon; and no tax deficiency has
been asserted against the Company, nor does the Company know of any tax
deficiency which is likely to be asserted against the Company which if
determined adversely to the Company would result in a Material Adverse Effect.
All tax liabilities are adequately provided for on the books of the Company.
(u) Except as disclosed in the Prospectus, the Company maintains insurance
(policies of which have been duly issued by insurers of recognized financial
position and responsibility) of the types and in the amounts generally deemed
adequate for its businesses and, consistent with insurance coverage maintained
by similar companies in similar businesses, including, but not limited to,
insurance covering real and personal property owned or leased by the Company
against theft, damage, destruction, acts of vandalism and all other risks
customarily insured against, and casualty and liability insurance covering the
Company's operations, all of which insurance is in full force and effect.
(v) Neither the Company nor any of its officers, directors, or affiliates
have taken and will not take, directly or indirectly, any action designed to, or
that might be reasonably expected to, cause or result in or constitute, the
stabilization or manipulation of the price of the Shares to facilitate the sale
or resale of the Shares.
(w) The Shares have been approved for listing on The New York Stock
Exchange (the "NYSE"), subject to official notice of issuance.
(x) The Company has not incurred any liability for a fee, commission or
other compensation on account of the employment of a broker or finder in
connection with the transactions contemplated by this Agreement other than as
contemplated hereby.
(ab) The Company is organized in conformity with the requirements for
qualification as a real estate investment trust under the Internal Revenue Code
of 1986, as amended (the "Code"), and the Company's method of operation will
enable it to meet the requirements for taxation as a real estate investment
trust under the Code. The Subsidiaries of the Company that are partnerships
will be treated as partnerships for federal income purposes and not as
corporations or associations taxable as corporations.
(ac) The Company's ownership interest in Carriage House Assisted Living,
Inc. ("Carriage") is less than 10% of the issued and outstanding voting stock of
Carriage. The Company does not have any other ownership interest in any other
corporation except those corporations meeting the definition of qualified REIT
subsidiaries under Section 856 of the Code.
Any certificate signed by any duly authorized officer of the Company and
delivered to you or to counsel for the Underwriters shall be deemed a
representation and warranty by the Company to each Underwriter as to the matters
covered thereby.
Section 2. Sale and Delivery of Shares to the Underwriters; Closing.
(a) On the basis of the representations and warranties herein contained,
and subject to the terms and conditions herein set forth, the Company, agrees to
sell to the several Underwriters the number of Shares set forth in the first
paragraph of this Underwriting Agreement, and each such Underwriter agrees,
severally and not jointly, to purchase from the Company, at a purchase price of
$25.00 per share, the number of Shares set forth opposite the name of such
Underwriter in Schedule A hereto.
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(b) Payment of the purchase price for the Shares shall be made at the
offices of Latham & Watkins, 633 West Fifth Street, Suite 4000, Los Angeles,
California, or at such other place as shall be agreed upon by the Company and
you, at 8:00 A.M., local time, either (i) on the third (fourth, if the pricing
occurs after 4:30 P.M. Eastern Time) full business day after the date hereof, or
(ii) at such other time not more than ten full business days thereafter as you
and the Company shall determine (unless, in either case, postponed pursuant to
Section 10) (such date and time of payment and delivery being herein called the
"Closing Time"). Payment for the Shares shall be made to the Company by wire
transfer in immediately available United States funds payable to the order of
the Company, against delivery to you for the respective accounts of the
Underwriters of the Shares to be purchased by them. It is understood that each
Underwriter has authorized the Representatives, for its account, to accept
delivery, give a receipt for and make payment of the purchase price for the
Shares which it has agreed to purchase. Morgan Keegan & Company, Inc., J.C.
Bradford & Co., Crowell, Weedon & Co. and Sutro & Co. Incorporated, individually
and not as Representatives of the Underwriters, may (but shall not be obligated
to) make payment of the purchase price for the Shares to be purchased by any
Underwriter whose payment has not been received by the Closing Time, but such
payment shall not relieve such Underwriter from its obligations hereunder.
(c) The Shares shall be issued in book-entry form through the facilities
of The Depository Trust Company, New York, New York ("DTC"), at the applicable
Closing Time. In that regard, the Company shall cause its transfer agent to
issue to Cede & Company, as nominee for DTC, at least twenty-four (24) hours
before a Closing Time, a global certificate representing the number of Shares to
be issued at the Closing Time, interests in which shall be registered in the
names and the amounts indicated by the Representatives.
Section 3. Certain Covenants of the Company. The Company covenants and
agrees with each Underwriter as follows:
(a) The Company will file the Prospectus pursuant to the applicable
provisions of Rule 424(b) within the time period prescribed. During any time
when a prospectus relating to the Shares is required to be delivered under the
Act, the Company (i) will comply with all requirements imposed upon it by the
1933 Act, the 1934 Act, the 1933 Act Rules and the 1934 Act Rules to the extent
necessary to permit the continuance of sales of or dealings in the Shares in
accordance with the provisions hereof and of the Prospectus, as then amended or
supplemented, and (ii) will not file with the Commission the Prospectus, any
amendment or supplement to the Prospectus, or any amendment to the Registration
Statement, of which the Representatives shall not previously have been advised
and furnished with a copy a reasonable period of time prior to the proposed
filing and as to which filing the Representatives shall not have give their
consent. The Company will advise the Representatives, promptly after receiving
notice thereof, of the time when (1) the Prospectus has been filed with the
Commission and (2) any amendment to the Registration Statement has been filed or
declared effective or any amendment or supplement to the Prospectus has been
filed and will provide evidence satisfactory to the Representatives of each such
filing or effectiveness.
(b) The Company will advise the Representatives promptly after receiving
notice or obtaining knowledge thereof, of (i) the issuance by the Commission of
any stop order suspending the effectiveness of the Registration Statement or any
post-effective amendment thereto or any order directed at any document
incorporated by reference in the Registration Statement or the Prospectus or any
amendment or supplement thereto or any order preventing or suspending the use of
the Prospectus, (ii) the suspension of the qualification of the Shares for
offering or sale in any jurisdiction, (iii) the institution, threatening or
contemplation of any proceeding for any such purpose or (iv) any request made by
the Commission for amending or supplementing the Registration Statement, for
amending the Prospectus or for additional information. The Company will use its
best efforts to prevent the issuance of any such stop order or of any order
preventing or suspending such use and, if any such order is issued, to obtain
the withdrawal thereof as promptly as possible.
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(c) The Company has furnished or will furnish to you, at its expense, as
soon as available, three (3) copies of the Registration Statement as originally
filed and of all amendments thereto, whether filed before or after the
Registration Statement becomes effective, copies of all exhibits and documents
filed therewith and signed copies of all consents and certificates of experts,
as you may reasonably request, and has furnished or will furnish to each
Underwriter, one conformed copy of the Registration Statement as originally
filed and of each amendment thereto (but without exhibits).
(d) The Company will deliver to each Underwriter, at its expense, from
time to time, as many copies of each Preliminary Prospectus as such Underwriter
may reasonably request, and the Company hereby consents to the use of such
copies for purposes permitted by the 1933 Act. The Company will deliver to each
Underwriter, at its expense, as soon as the Registration Statement shall have
become effective, and thereafter from time to time as requested during the
period when the Prospectus is required to be delivered under the 1933 Act, such
number of copies of the Prospectus (as supplemented or amended) as each
Underwriter may reasonably request.
(e) The Company will comply to the best of its ability with the 1933 Act
and the 1933 Act Regulations so as to permit the completion of the distribution
of the Shares as contemplated in this Agreement and in the Prospectus. If, at
any time when a Prospectus is required by the 1933 Act to be delivered in
connection with sales of the Shares, any event shall occur or condition exist as
a result of which it is necessary, in the opinion of counsel for the
Underwriters or counsel for the Company, to amend the Registration Statement or
amend or supplement the Prospectus in order that the Prospectus will not include
an untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements therein not misleading in the light of
the circumstances existing at the time it is delivered to a purchaser, or if it
shall be necessary, in the opinion of either such counsel, at any such time to
amend the Registration Statement or amend or supplement the Prospectus in order
to comply with the requirements of the 1933 Act or the 1933 Act Regulations, the
Company will promptly prepare and file with the Commission, subject to the
provisions of Section 5(b), such amendment or supplement as may be necessary to
correct such untrue statement or omission or to make the Registration Statement
or the Prospectus comply with such requirements.
(f) The Company will use its best efforts, in cooperation with you, to
qualify the Shares for offering and sale under the applicable securities laws of
such states and other jurisdictions as you may designate and to maintain such
qualifications in effect for as long as may be necessary to complete the
distribution of the Shares; provided, however, that the Company shall not be
obligated to file any general consent to service of process or to qualify as a
foreign corporation in any jurisdiction in which it is not otherwise so subject.
The Company will file such statements and reports as may be required by the laws
of each jurisdiction in which the Shares have been qualified as above provided.
(g) The Company will use the net proceeds received by it from the sale of
the Shares in the manner specified in the Prospectus under the caption "Use of
Proceeds."
(h) The Company will timely file such reports pursuant to the 1934 Act as
are necessary in order to make generally available to its security holders and
to you as soon as practicable an earnings statement for the purposes of, and to
provide the benefits contemplated by, the last paragraph of Section 11(a) of the
1933 Act.
(i) The Shares will be listed on the NYSE, subject to notice of issuance,
and the Company will use it best efforts to maintain the listing of the Shares
on the NYSE.
(j) Prior to the Closing Time, the Company will notify you in writing
immediately if any event occurs that renders any of the representations and
warranties of the Company contained herein inaccurate or incomplete in any
respect.
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(k) The Company will comply with all provisions of any undertakings
contained in the Registration Statement.
(l) The Company will use its best efforts (i) to meet the requirements to
qualify as a real estate investment trust under the Code and (ii) to cause each
of its Subsidiaries that is organized as a partnership to be treated as a
partnership for federal income tax purposes.
(m) To its knowledge, the Company has complied and will endeavor to comply
with all provisions of Section 517.075 of the Florida Securities and Investor
Protection Act, and all regulations thereunder, relating to issuers doing
business with Cuba.
Section 4. Payment of Expenses. (a) The Company will pay and bear all
costs, fees and expenses incident to the performance of its obligations under
this Agreement, including (i) the preparation, printing and filing of the
Registration Statement (including financial statements and exhibits), as
originally filed and as amended, the Preliminary Prospectuses and the Prospectus
and any amendments or supplements thereto, and the cost of furnishing copies
thereof to the Underwriters; (ii) the preparation, printing and distribution of
this Agreement, the Master Agreement Among Underwriters, the Selected Dealer
Agreement, Blue Sky Memorandum, certificates representing the Shares, and any
instruments relating to any of the foregoing; (iii) the issuance and delivery of
the Shares to the Underwriters, including any transfer taxes payable upon the
sale of the Shares to the Underwriters (other than transfer taxes on resales by
the Underwriters); (iv) the fees and disbursements of the Company's counsel and
accountants; (v) the qualification of the Shares under the applicable securities
laws in accordance with Section 4(f) hereof and any filing for review of the
offering with the NASD, including filing fees and fees and disbursements of
counsel for the Underwriters in connection therewith and in connection with the
Blue Sky Memorandum; (vi) costs related to travel and lodging incurred by the
Company and its representatives relating to meetings with and presentations to
prospective purchasers of the Shares reasonably determined by the Underwriters
to be necessary or desirable to effect the sale of the Shares to the public;
(vii) all costs, fees and expenses in connection with the application and
listing of the Shares on the NYSE; and (ix) all other costs and expenses
incident to the performance of the Company's obligations hereunder that are not
otherwise specifically provided for in this section. The Company, upon your
request, will provide funds in advance for filing fees in connection with "blue
sky" qualifications and the NASD.
(b) If the sale of Shares provided for herein is not consummated because
any condition to the obligations of the Underwriters set forth in Section 5
hereof is not satisfied, because of a termination pursuant to Section 9 (b)(ii)
hereof or because of any refusal, inability or failure on the part of the
Company to perform any agreement herein or comply with any provision hereof
other than by reason of a default by any of the Underwriters, the Company will
reimburse the Underwriters, on demand, for all reasonable out-of-pocket
expenses, including fees and disbursements of Underwriters' counsel, reasonably
incurred by the Underwriters in reviewing the Registration Statement and the
Prospectus, and in investigating and making preparations for the marketing of
the Shares. The Company shall not in any event be liable to any of the
Underwriters for the loss of anticipated profits from the transactions covered
by this Agreement.
Section 5. Conditions of Underwriters' Obligations. The several
obligations of the Underwriters to purchase and pay for the Shares pursuant to
this Agreement shall be subject, in the Representatives' sole discretion, to the
continued accuracy at all applicable times and in all material respects of the
representations and warranties of the Company contained herein or in
certificates of any officer of the Company delivered pursuant to the provisions
hereof, to the performance by the Company and of their respective obligations
hereunder, and to the following further conditions:
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(a) The Prospectus shall have been filed with the Commission in the manner
and within the time period required by Rule 424(b) under the 1933 Act; no stop
order suspending the effectiveness of the Registration Statement or any post-
effective amendment thereto and no order directed at any document incorporated
by reference in the Registration Statement or the Prospectus or any amendment or
supplement thereto shall have been issued and no proceedings for that purpose
shall have been instituted or threatened or, to the knowledge of the Company or
the Representatives, shall be contemplated by the Commission; and the Company
shall have complied with any request of the Commission for additional
information (to be included in the Registration Statement or the Prospectus or
otherwise).
(b) The amendment to the Company's Amended and Restated Articles of
Incorporation providing for the issuance of the Shares (the "Designating
Amendment") shall have been filed with Secretary of State of Maryland and become
effective.
(c) At the Closing Time you shall have received the opinions of Pamela
Privett, Esq., General Counsel of the Company and Latham & Watkins and Ballard,
Spahr, Andrews & Ingersoll, special counsel for the Company, together with
signed or reproduced copies of such opinion for each of the other Underwriters,
in form and substance satisfactory to Baker, Donelson, Bearman & Caldwell,
counsel for the Underwriters, as set forth in Exhibits "A," "B," "C" and "D"
hereto.
(d) At the Closing Time, you shall have received a favorable opinion from
Baker, Donelson, Bearman & Caldwell, counsel for the Underwriters, dated as of
the Closing Time, with respect to the Registration Statement, the Prospectus and
other related matters as the Underwriters may reasonably require, and the
Company shall have furnished to such counsel such documents as they may
reasonably request for the purpose of enabling them to pass upon such matters.
In rendering such opinion, such counsel may rely as to all matters of Maryland
law upon the opinion of Ballard Spahr, Andrews & Ingersoll attached hereto as
Exhibit "C."
(e) At the Closing Time, (i) the Registration Statement and the
Prospectus, as they may then be amended or supplemented, shall contain all
statements that are required to be stated therein under the 1933 Act and the
1933 Act Regulations and in all material respects shall conform to the
requirements of the 1933 Act and the 1933 Act Regulations, the Company shall
have complied in all material respects with Rule 424(b) and neither the
Registration Statement nor the Prospectus, as they may then be amended or
supplemented, shall contain an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading; (ii) there shall not have been, since the
respective dates as of which information is given in the Prospectus, any
Material Adverse Effect, whether or not arising in the ordinary course of
business; (iii) no action, suit or proceeding at law or in equity shall be
pending or, to the best of the Company's knowledge, threatened against the
Company that would be required to be set forth in the Prospectus other than as
set forth therein and no proceedings shall be pending or threatened against the
Company before or by any federal, state or other commission, board or
administrative agency wherein an unfavorable decision, ruling or finding would
result in a Material Adverse Effect, other than as set forth in the Prospectus;
(iv) the Company shall have complied with all agreements and satisfied all
conditions on its part to be performed or satisfied at or prior to the Closing
Time; and (v) the representations and warranties of the Company set forth in
Section 1 shall be accurate as though expressly made at and as of the Closing
Time. At the Closing Time, you shall have received certificates executed by the
President and the Chief Financial Officer of the Company, dated as of the
Closing Time, to such effect and with respect to the following additional
matters: (A) no stop order suspending the effectiveness of the Registration
Statement or any post-effective amendment thereto or preventing or suspending
the use of the Prospectus and no order directed at any document incorporated by
reference in the Registration Statement or any amendment thereto or the
Prospectus has been issued, and no proceedings for that purpose have been
instituted or are pending or, to the best of their knowledge, threatened under
the 1933 Act; and (B) they have carefully reviewed the Registration Statement
and the Prospectus and when the Registration Statement became effective and at
all times subsequent thereto up to the delivery of such certificate, the
Registration
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Statement and the Prospectus and any amendments or supplements thereto contained
all statements and information required to be included therein or necessary to
make the statements therein not misleading and none of the Registration
Statement, the Prospectus or any amendment or supplement thereto included any
untrue statement of a material fact or omitted to state any material fact
required to be stated therein or necessary in order to make the statements
therein not misleading, and, since the Effective Time of the Registration
Statement, there has occurred no event required to be set forth in an amended or
supplemented Prospectus that has not been so set forth, and (C) all
representations, warranties, covenants and statements made herein by the Company
are true and correct at such Closing Time, with the same effect as if made on
and as of such Closing Time, and all agreements herein to be performed by the
Company on or prior to such Closing Time have been duly performed.
(f) At the Execution Time, you shall have received from Ernst & Young LLP
a letter dated the date hereof substantially in the form set forth as Exhibit
"E" hereto.
(g) At the Closing Time, you shall have received from Ernst & Young LLP a
letter, in form and substance satisfactory to you and dated as of the Closing
Time, to the effect that they reaffirm the statements made in the letter
furnished pursuant to subsection (f) above, except that the specified date
referred to shall be a date not more than three business days prior to the
Closing Time.
(h) In the event that either of the letters to be delivered pursuant to
subsections (f) and (g) above sets forth any changes, decreases or increases as
described in the letter, it shall be a further condition to your obligations
that you shall have determined, after discussions with officers of the Company
responsible for financial and accounting matters and with Ernst & Young LLP,
that such changes, decreases or increases as are set forth in such letters do
not reflect a Material Adverse Effect concerning the capital stock, long-term
debt, obligations under capital leases, total assets, or shareholders' equity of
the Company as compared with the amounts shown in the latest condensed
consolidated balance sheet of the Company, or a Material Adverse Effect in
revenues or the total or per share amounts of income before extraordinary items
or net income, of the Company, in each case as compared with the corresponding
period of the prior year.
(i) At the Closing Time, counsel for the Underwriters shall have been
furnished with all such documents, certificates and opinions as they may request
for the purpose of enabling them to pass upon the issuance and sale of the
Shares as contemplated in this Agreement and the matters referred to in Section
5(d) and in order to evidence the accuracy and completeness of any of the
representations and warranties or statements of the Company, the performance of
any of the covenants of the Company, or the fulfillment of any of the conditions
herein contained; and all proceedings taken by the Company at or prior to the
Closing Time in connection with the authorization, issuance and sale of the
Shares as contemplated in this Agreement shall be satisfactory in form and
substance to you and to counsel for the Underwriters. The Company will furnish
you with such number of conformed copies of such opinion, certificates, letters
and documents as you shall request.
(j) The NASD, upon review of the terms of the public offering of the
Shares, shall not have objected to such offering, such terms or the
Underwriters' participation in the same.
(k) The Shares shall have been approved for listing on NYSE upon official
notice of the issuance, sale and evidence of satisfactory distribution thereof
pursuant to this underwritten public offering.
If any of the conditions specified in this Section 5 shall not have been
fulfilled when and as required by this Agreement to be fulfilled, this Agreement
may be terminated by you on notice to the Company at any time at or prior to the
Closing Time, and such termination shall be without liability of any party to
any other party. Notwithstanding any such termination, the provisions of
Section 7 shall remain in effect.
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Section 6. Intentionally omitted.
Section 7. Indemnification and Contribution. (a) The Company agrees to
indemnify and hold harmless each Underwriter and each person, if any, who
controls any Underwriter within the meaning of Section 15 of the 1933 Act or
Section 20 of the 1934 Act, against any losses, claims, damages or liabilities
to which such Underwriter or controlling person may become subject under the
1933 Act, the 1934 Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon any
breach of any warranty of the Company herein contained or any untrue statement
or alleged untrue statement of a material fact contained in the Registration
Statement, any Preliminary Prospectus, the Prospectus, or any amendment or
supplement thereto, or in any "blue sky" application or other document executed
by the Company or based upon any information furnished in writing by the
Company, filed in any jurisdiction in order to qualify any or all of the Shares
under the securities laws thereof ("Blue Sky Application"), or arise out of or
are based upon the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading; and will reimburse each Underwriter for any legal or other expenses
reasonably incurred by such Underwriter in connection with investigating or
defending any such loss, claim, damage, liability or action; provided, however,
that the Company shall not be liable in any such case to the extent that any
such loss, claim, damage or liability arises out of or is based upon an untrue
statement or alleged untrue statement or omission or alleged omission made in
the Registration Statement, such Preliminary Prospectus or the Prospectus, or
such amendment or supplement, or any Blue Sky Application in reliance upon and
in conformity with written information furnished to the Company by you or by any
Underwriter through you expressly for use therein; provided, further, that the
Company will not be liable for any such losses, claims, damages, or liabilities
arising from the sale of the Shares to any person if a copy of the Prospectus
(as first filed pursuant to Rule 424(b)) or the Prospectus as amended or
supplemented by all amendments or supplements thereto which has been furnished
to the Underwriters shall not have been sent, mailed or given to such person, at
or prior to the written confirmation of the sale of such Shares to such person,
but only if and to the extent that such Prospectus, if so sent or delivered,
would have cured the defect giving rise to such losses, claims, damages or
liabilities. In addition to its other obligations under this Section 7(a), the
Company agrees that, as an interim measure during the pendency of any such
claim, action, investigation, inquiry or other proceeding arising out of or
based upon any statement or omission, or any alleged statement or omission,
described in this Section 7(a), they will reimburse the Underwriters on a
monthly basis for all reasonable legal and other expenses incurred in connection
with investigating or defending any such claim, action, investigation, inquiry
or other proceeding, notwithstanding the absence of a judicial determination as
to the propriety and enforceability of the Company's obligation to reimburse the
Underwriters for such expense and the possibility that such payments might later
be held to have been improper by a court of competent jurisdiction. This
indemnity agreement shall be in addition to any liabilities that the Company may
otherwise have. For purposes of this Section 7, the information set forth in
the last paragraph on the front cover page, the stabilization legend on the
inside cover page and under "Underwriting" in any Preliminary Prospectus and in
the Prospectus constitutes the only information furnished by the Underwriters to
the Company for inclusion in any Preliminary Prospectus, the Prospectus or the
Registration Statement.
(b) Each Underwriter, severally but not jointly, will indemnify and hold
harmless the Company against any losses, claims, damages or liabilities to which
the Company may become subject, under the 1933 Act specifically including but
not limited to losses, claims, damages or liabilities related to negligence on
the part of the Company, insofar as such losses, claims, damages or liabilities
(or actions in respect thereof) arise out of or are based upon any breach of any
warranty or covenant by you herein contained or any untrue statement or alleged
untrue statement of any material fact contained in the Registration Statement,
any Preliminary Prospectus, the Prospectus, or any amendment or supplement
thereto, or any Blue Sky Application or arise out of or are based upon the
omission or the alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, in
each case to the extent, but only to the extent, that such untrue
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statement or alleged untrue statement or omission or alleged omission was made
in the Registration Statement, such Preliminary Prospectus or the Prospectus, or
such amendment or supplement, or any Blue Sky Application, in reliance upon and
in conformity with information furnished to the Company by such Underwriter
expressly for use therein; and will reimburse the Company for any legal or other
expenses reasonably incurred by the Company in connection with investigating or
defending any such loss, claim, damage, liability or action. In addition to
their other obligations under this Section 7(b), the Underwriters agree that, as
an interim measure during the pendency of any such claim, action, investigation,
inquiry or other proceeding arising out of or based upon any statement or
omission, or any alleged statement or omission, described in this Section 7(b),
they will reimburse the Company on a monthly basis for all reasonable legal and
other expenses incurred in connection with investigating or defending any such
claim, action, investigation, inquiry or other proceeding, notwithstanding the
absence of a judicial determination as to the propriety and enforceability of
their obligation to reimburse the Company for such expense and the possibility
that such payments might later be held to have been improper by a court of
competent jurisdiction. Any such interim reimbursement payments that are not
made to the Company within 30 days of a request for reimbursement shall bear
interest at the Prime Rate from the date of such request. This indemnity
agreement shall be in addition to any liabilities which the Underwriters may
otherwise have.
The indemnity agreement in this Section 7(b) shall extend upon the same
terms and conditions to, and shall inure to the benefit of, each officer and
director of the Company and each person, if any, who controls the Company within
the meaning of the 1933 Act to the same extent as such agreement applies to the
Company.
(c) Within ten days after receipt by an indemnified party under subsection
(a) or (b) above of notice of commencement of any action, such indemnified party
shall, if a claim in respect thereof is to be made against the indemnifying
party under such subsection, notify the indemnifying party in writing of the
commencement thereof; no indemnification provided in this Section 7(a) or 7(b)
shall be available to any party who shall fail to give notice as provided in
this Section 7(c) if the 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 omission so to notify the indemnifying
party will not relieve the indemnifying party from any liability that it may
have to any indemnified party otherwise than under this Section 7. In case any
such action 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 assume the defense
thereof, with counsel satisfactory to such indemnified party, and after notice
from the indemnifying party to such indemnified party of its election so to
assume the defense thereof the indemnifying party shall not be liable to such
indemnified party for any legal or other expenses, other than reasonable costs
of investigation, subsequently incurred by such indemnified party in connection
with the defense thereof. The indemnified party shall have the right to employ
its own counsel in any such action, but the fees and expenses of such counsel
shall be at the expense of such indemnified party unless (i) the employment of
counsel by such indemnified party has been authorized by the indemnifying party,
(ii) the indemnified party shall have been advised by such counsel that there
may be a conflict of interest between the indemnifying party and the indemnified
party in the conduct of the defense of such action (in which case the
indemnifying party shall not have the right to direct the defense of such action
on behalf of the indemnified party) or (iii) the indemnifying party shall not in
fact have employed counsel to assume the defense of such action, in any of which
events such fees and expenses shall be borne by the indemnifying party. 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 judgment 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) In circumstances in which the indemnity agreement provided for in this
Section 7 is unavailable or insufficient to hold harmless an indemnified party
in respect of any losses, claims, damages or liabilities (or actions in respect
thereof), each indemnifying party, in order to provide for just and equitable
contribution, shall
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contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages or liabilities (or actions in respect thereof)
in such proportions as appropriate to reflect (i) the relative benefits
received by the indemnifying party or parties on the one hand and the
indemnified party on the other from the public offering described herein or (ii)
if the allocation provided by the foregoing clause (i) is not permitted by
applicable law, not only such relative benefits but also the relative fault of
the indemnifying party or parties on the one hand and the indemnified party on
the other in connection with the statements or omissions or alleged statements
or omissions that resulted in such losses, claims, damages or liabilities ( or
actions in respect thereof). The relative benefits received by the Company on
the one hand and the Underwriters on the other shall be deemed to be in the same
proportion as the total proceeds from the offering (before deducting expenses)
received by the Company bear to the total underwriting discounts and commissions
received by the Underwriters. The relative fault of the parties 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 supplied by the Company, or by the
Underwriters and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission, or any other
equitable considerations appropriate in the circumstances. The Company and the
Underwriters agree that it would not be equitable if the amount of such
contribution were determined by pro rata or per capita allocation (even if the
Underwriters were treated as one entity for such purpose) or by any other method
of allocation that does not take into account the equitable considerations
referred to in the first sentence of this paragraph. Notwithstanding the
provisions of this subsection, no Underwriter shall be required to contribute
any amount in excess of the amount by which the total price at which the Shares
underwritten by it and distributed to the public were offered to the public
exceeds the amount of any damages which such Underwriter has otherwise been
required to pay by reason of such untrue or alleged untrue statement or omission
or alleged omission, and no person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. The Underwriters' obligations to contribute hereunder are
several in proportion to their respective underwriting obligations and not
joint, and contributions among Underwriters shall be governed by the provisions
of the Master Agreement Among Underwriters. For purposes of this Section 7(d),
each person, if any, who controls an Underwriter within the meaning of Section
15 of the 1933 Act shall have the same rights to contribution as such
Underwriter, and each director of the Company, each officer of the Company who
signed the Registration Statement and each person, if any, who controls the
Company within the meaning of Section 15 of the 1933 Act shall have the same
rights to contribution as the Company.
Section 8. Representations and Agreements to Survive Delivery. The
representations, warranties, indemnities, agreements and other statements of the
Company or its officers set forth in or made pursuant to this Agreement will
remain operative and in full force and effect regardless of any investigation
made by or on behalf of the Company, or any Underwriter or controlling person,
with respect to an Underwriter or the Company and will survive delivery of and
payment for the Shares or termination of this Agreement.
Section 9. Effective Time of Agreement and Termination. (a) This
Agreement shall become effective upon the execution and delivery hereof by the
parties hereto.
(b) You may terminate this Agreement by notice to the Company at any time
at or prior to the Closing Time (i) in accordance with the last paragraph of
Section 5 of this Agreement; or (ii) if there has been, since the respective
dates as of which information is given in the Registration Statement, any
Material Adverse Effect, or any development which might reasonably be viewed as
resulting in a Material Adverse Effect, whether or not arising in the ordinary
course of business; or (iii) if there has occurred or accelerated any outbreak
of hostilities or other national or international calamity or crisis or change
in economic or political conditions the effect of which on the financial markets
of the United States is such as to make it, in your judgment, impracticable to
market the Shares or enforce contracts for the sale of the Shares; or (iv) if
trading in any securities of the
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Company has been suspended by the Commission or by the NASD or the NYSE, or if
trading generally on the New York Stock Exchange or in the over-the-counter
market has been suspended, or limitations on prices for trading (other than
limitations on hours or numbers of days of trading) have been fixed, or maximum
ranges for prices for securities have been required, by such exchange or the
NASD or by order of the Commission or any other governmental authority; or (v)
if a banking moratorium has been declared by federal or New York or Maryland
authorities; or (vi) any federal or state statute, regulation, rule or order of
any court or other governmental authority has been enacted, published, decreed
or otherwise promulgated which in your reasonable opinion materially adversely
affects or will materially adversely affect the business or operations of the
Company; or (vii) any action has been taken by any federal, state or local
government or agency in respect of its monetary or fiscal affairs which in your
reasonable opinion has a material adverse effect on the securities markets in
the United States.
(c) If this Agreement is terminated pursuant to this Section 9, such
termination shall be without liability of any party to any other party, except
to the extent provided in Section 4. Notwithstanding any such termination, the
provisions of Section 7 shall remain in effect.
Section 10. Default by One or More of the Underwriters. (a) If any
Underwriter shall default in its obligation to purchase the Shares which it has
agreed to purchase hereunder, you may in your discretion arrange for you or
another party or other parties to purchase such Shares on the terms contained
herein. If within 36 hours after such default by any Underwriter you do not
arrange for the purchase of such Shares, then the Company shall be entitled to a
further period of 36 hours within which to procure another party or other
parties satisfactory to you to purchase such Shares on such terms. In the event
that, within the respective prescribed periods, you notify the Company that you
have so arranged for the purchase of such Shares, or the Company notifies you
that it has so arranged for the purchase of such Shares, you or the Company
shall have the right to postpone the Closing Time for a period of not more than
seven days in order to effect whatever changes may thereby be made necessary in
the Registration Statement or the Prospectus, or in any other documents or
arrangements, and the Company agrees to file promptly any amendments to the
Registration Statement or the Prospectus which in your opinion may thereby be
made necessary. The term "Underwriter" as used in this Agreement shall include
any persons substituted under this Section 10 with like effect as if such person
had originally been a party to this Agreement with respect to such Shares.
(b) If, after giving effect to any arrangements for the purchase of the
Shares of a defaulting Underwriter or Underwriters made by you or the Company as
provided in subsection (a) above, the aggregate number of Shares which remains
unpurchased does not exceed 10% of the aggregate number of Shares to be
purchased pursuant to this Agreement, then the Company shall have the right to
require each nondefaulting Underwriter to purchase the Shares which such
Underwriter agreed to purchase hereunder and, in addition, to require each
nondefaulting Underwriter to purchase its pro rata share (based on the number of
Shares which such Underwriter agreed to purchase hereunder) of the Shares of
such defaulting Underwriter or Underwriters for which such arrangements have not
been made; but nothing herein shall relieve a defaulting Underwriter from
liability for its default.
(c) If, after giving effect to any arrangements for the purchase of the
Firm Shares of a defaulting Underwriter or Underwriters made by you or the
Company as provided in subsection (a) above, the number of Shares which remains
unpurchased exceeds 10% of the aggregate number of Shares to be purchased
pursuant to this Agreement or if the Company shall not exercise the right
described in subsection (b) above to require nondefaulting Underwriters to
purchase Shares of a defaulting Underwriter or Underwriters, then this
Agreement shall thereupon terminate, without liability on the part of any
nondefaulting Underwriter or the Company except for the expenses to be borne by
the Company, and the Underwriters as provided in Section 4 hereof and the
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indemnity and contribution agreements in Section 7 hereof; but nothing herein
shall relieve a defaulting Underwriter from liability for its default.
Section 11. Default by the Company. If the Company shall fail at the
Closing Time to sell and deliver the aggregate number of Shares that it is
obligated to sell, then this Agreement shall terminate without any liability on
the part of any nondefaulting party, except to the extent provided in Section 4
and except that the provisions of Section 7 shall remain in effect. No action
taken pursuant to this Section shall relieve the Company from liability, if any,
in respect of its default.
Section 12. Notices. All notices and other communications under this
Agreement shall be in writing and shall be deemed to have been duly given if
mailed, delivered or transmitted by any standard form of telecommunication.
Notices to the Underwriters shall be directed c/o Morgan Keegan & Company, Inc.,
50 Front Street, Memphis, Tennessee 38103, attention of Mr. James Harwood, Vice
President (with a copy sent in the same manner to Baker, Donelson, Bearman &
Caldwell, 2000 First Tennessee Building, 165 Madison Avenue, Memphis, Tennessee
38103, attention of John A. Good, Esq.); and notices to the Company shall be
directed to LTC Properties, Inc., 300 Esplanade Drive, Suite 1860, Oxnard,
California 93030, Attention Mr. Jim Pieczynski, Chief Financial Officer (with a
copy sent in the same manner to Latham & Watkins, 633 West Fifth Street, Suite
4000, Los Angeles, California 90071, Attention of Gary Olson, Esq.). Each
notice hereunder shall be effective upon receipt by the party to which it is
addressed.
Section 13. Parties. This Agreement is made solely for the benefit of the
Underwriters, and the Company and, to the extent so provided, any person
controlling the Company or any of the Underwriters, and the directors of the
Company, its officers who have signed the Registration Statement, and their
respective executors, administrators, successors and assigns and, subject to the
provisions of Section 10, no other person shall acquire or have any right under
or by virtue of this Agreement. The term "successors and assigns" shall not
include any purchaser, as such purchaser, from any of the several Underwriters
of the Shares.
Section 14. Governing Law and Time. This Agreement shall be governed by,
and construed in accordance with, the laws of the State of New York. Specified
time of the day refers to United States Central Time.
Section 15. Counterparts. This Agreement may be executed in one or more
counterparts and when a counterpart has been executed by each party, all such
counterparts taken together shall constitute one and the same agreement.
-16-
<PAGE>
If the foregoing is in accordance with your understanding of our agreement,
please sign and return to us a counterpart hereof, whereupon this instrument
will become a binding agreement among the Company and the several Underwriters
in accordance with its terms.
Very truly yours,
LTC PROPERTIES, INC.
By: /s/ William McBride, III
-----------------------------------------
William McBride III
President and Chief Operating Officer
Confirmed and accepted in Memphis,
Tennessee, as of the date
first above written, as
Representatives of the
Underwriters named
in Schedule A hereto.
MORGAN KEEGAN & COMPANY, INC.
By: /s/ Randolph C. Coley
------------------------------------
Randolph C. Coley, Managing Director
-17-
<PAGE>
SCHEDULE A
----------
<TABLE>
<CAPTION>
Number
of
Name Shares
---- ------
<S> <C>
Morgan Keegan & Company, Inc..........................................1,001,000
J.C. Bradford & Co....................................................1,001,000
Crowell, Weedon & Company............................................. 539,000
Sutro & Co. Incorporated.............................................. 539,000
Total............................................................3,080,000
</TABLE>
-18-
<PAGE>
EXHIBIT 12
LTC PROPERTIES, INC.
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
(Dollars in thousands)
(unaudited)
<TABLE>
<CAPTION>
PERIOD ENDED DECEMBER 31,
-----------------------------------------------
1996 1995 1994 1993 1992(1)
<S> <C> <C> <C> <C> <C>
Net income $22,537 $20,040 $15,338 $ 6,847 $ 763
Add Fixed Charges:
Interest expense including
amortization of debt issue costs 20,604 9,407 6,563 6,400 2,597
Minority interest (2) 898 57 - - -
------- ------- ------- ------- ------
Earnings 44,039 29,504 21,901 13,247 3,360
Interest expense including
amortization of debt issue costs 20,604 9,407 6,563 6,400 2,597
Minority interest (2) 898 57 - - -
------- ------- ------- ------- ------
Fixed charges 21,502 9,464 6,563 6,400 2,597
Ratio of earnings to fixed charges 2.05x 3.12x 3.34x 2.07x 1.29x
======= ======= ======= ======= ======
</TABLE>
- ------------------------------
1) From August 25, 1992 (commencement of operations) to December 31, 1992
2) Fixed distribution to minority interests
