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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 8-K
Current Report
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): March 17, 1997
LEXINGTON CORPORATE PROPERTIES, INC.
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(Exact Name of Registrant as specified in its charter)
MARYLAND 1-12386 13-3717318
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(State or other jurisdiction (Commission File (IRS Employer
of incorporation) Number) Identification No.)
355 LEXINGTON AVENUE, NEW YORK, NEW YORK 10017
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(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code:
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(212) 692-7260
NOT APPLICABLE
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(Former name or former address, if changed since last report)
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Item 2. Acquisition of Property.
On March 19, 1997, the Registrant, through Lepercq Corporate Income Fund L.P., a
wholly-owned subsidiary of the Registrant) "LCIF", acquired three industrial
warehouse properties (the "Properties") for $27 million. The Properties contain
761,200 square feet and are located on 46.56 acres near Harrisburg,
Pennsylvania. The Properties are subject to net leases with Exel Logistics, Inc.
("Exel") which expire on November 30, 2006. The current annual net rent is
$2,536,941 and will increase by 9.27% to approximately $2.8 million on December
1, 1997 and by 9.27% every three years thereafter. The average net rent payable
during the remaining lease term is approximately $3 million, or approximately
11.1% of the purchase price. The obligations of Exel under the leases are
unconditionally guaranteed by its parent company, NFC plc.
Item 5. Other Events
Sale of 8% Exchangeable Notes. In connection with the acquisition of the Exel
Properties and pursuant to the terms of a Note Purchase Agreement, dated as of
March 19, 1997 among LCIF, the Registrant, Merrill Lynch Global Allocation Fund,
Inc. ("Purchaser"), and The Chase Manhattan Bank, as Trustee, LCIF sold to
Purchaser, an institutional investor, in a private placement 8.0% Exchangeable
Redeemable Secured Notes (the "Notes") in the aggregate principal amount of $25
million. The sale of the Notes took place in closings on March 19, 1997 ($21
million principal amount) and March 31, 1997 ($4 million principal amount).
Simultaneous with the first closing under the Note Purchase Agreement, the
Registrant entered into an Indenture (the "Indenture") and an Operating
Agreement (the "Operating Agreement" and together with the Note Purchase
Agreement and the Indenture, the "Note Purchase Documents"), each dated as of
March 19, 1997. References to the Note Purchase Agreement, the Indenture and the
Registration Rights Agreement are qualified in their entirety by reference to
such actual agreements which are attached hereto as Exhibits.
Pursuant to the Note Purchase Documents, the Notes bear interest at rate of 8.0%
per annum and mature in March 2004. The Notes are secured by first mortgage
liens on the Properties, are guaranteed by the Registrant, and can be exchanged
for the Registrant's common stock at $13 per share beginning in the year 2000,
subject to adjustment. The Notes may be redeemed at the Registrant's option
after three years at a price of 103.2% of the principal amount thereof,
declining to par after five years. The Registration Rights Agreement provides
the Investor with certain demand and piggyback registration rights with respect
to the shares of common stock of the Registrant issuable upon exchange of the
Notes. The Notes are subordinated in right of payment to obligations under the
Registrant's revolving credit facility. In connection with the issuance of the
Notes, the Board of Directors of the Registrant waived certain ownership
restrictions contained in the charter documents of the Registrant relating to
Purchaser's ownership of the common stock issuable upon exchange of the Notes.
Partnership Merger. In connection with the acquisition of the Properties, an
unaffiliated partnership (the "Partnership") merged into LCIF. At the time of
the merger, the Partnership's sole
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asset consisted of cash and a contractual right to acquire the Properties. As a
result of the merger, LCIF issued 480,000 partnership units (the "Units")
exchangeable, two years after issuance, for the Registrant's common stock. The
Units are entitled to distributions at the same dividend rate as the
Registrant's common stock.
Item 7. Financial Statements, Pro Forma Information and Exhibits.
(c) EXHIBITS.
5.1 Note Purchase Agreement, dated as of March 19, 1997 between
Lepercq Corporate Income Fund L.P., Lexington Corporate
Properties, Inc., Lex GP-1, Inc. and Merrill Lynch Global
Allocation Fund, Inc.
5.2 Registration Rights Agreement, dated as of March 19, 1997,
between Lexington Corporate Properties, Inc. and Merrill Lynch
Global Allocation Fund, Inc.
5.3 Indenture, dated as of March 19, 1997, among Lepercq Corporate
Income Fund L.P., Lex GP-1, Inc., Lexington Corporate
Properties, Inc. and The Chase Manhattan Bank, as Trustee.
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EXHIBIT INDEX
Exhibit No. Description
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5.1 Note Purchase Agreement, dated as of March 19, 1997 between
Lepercq Corporate Income Fund L.P., Lexington Corporate
Properties, Inc., Lex GP-1, Inc. and Merrill Lynch Global
Allocation Fund, Inc.
5.2 Registration Rights Agreement, dated as of March 19, 1997,
between Lexington Corporate Properties, Inc. and Merrill Lynch
Global Allocation Fund, Inc.
5.3 Indenture, dated as of March 19, 1997, among Lepercq Corporate
Income Fund L.P., Lex GP-1, Inc., Lexington Corporate
Properties, Inc. and The Chase Manhattan Bank, as Trustee.
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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.
LEXINGTON CORPORATE PROPERTIES, INC.
By: /s/ T. Wilson Eglin
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T. Wilson Eglin
President and Chief Operating Officer
Date: April 24, 1997
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Exhibit 5.1
NOTE PURCHASE AGREEMENT
This NOTE PURCHASE AGREEMENT (this "Agreement") is
made as of the 17th day of March, 1997 by and among Lepercq Corporate Income
Fund, L.P., a Delaware limited partnership (the "Issuer"), Lexington Corporate
Properties, Inc., a Maryland corporation ("Lexington"), Lex GP-1, Inc., a
Delaware corporation ("Lex GP-1"), Merrill Lynch Global Allocation Fund, Inc., a
Maryland corporation (the "Purchaser"), and National Westminster Bank PLC, New
York Branch, as placement agent (the "Placement Agent") under that certain
Placement Agency Agreement dated March 10, 1997 (the "Placement Agreement")
between the Issuer and the Placement Agent with respect to the transactions
contemplated hereunder.
In consideration of the mutual covenants and
agreements contained herein, the Issuer, Lexington, the Purchaser and the
Placement Agent, intending legally to be bound, hereby agree as follows:
ARTICLE 1.
AUTHORIZATION, SALE AND DELIVERY OF SECURITIES
SECTION 1.1 Authorization of Sale of the Securities.
Subject to the terms and conditions of this Agreement, the
Issuer has authorized the sale of up to $25,000,000 aggregate principal amount
of its 8.00% Exchangeable Redeemable Secured Notes Due 2004 (the "Securities"),
payment upon which shall be guaranteed, on the terms set forth in the Indenture
(as defined below), by Lexington and Lex GP-1. The terms of the Securities shall
be as set forth in the Trust Indenture to be entered into by the Issuer,
Lexington and The Chase Manhattan Bank, as trustee (the "Trustee"), in the form
of Exhibit A hereto (the "Indenture"). Neither the Securities nor the common
stock, par value $.0001 per share (the "Common Stock"), of Lexington, for which
the Securities are exchangeable have been registered under the Securities Act of
1933, as amended (the "Securities Act"), or any other securities laws of any
jurisdiction. The Securities and such Common Stock are being offered and sold in
reliance upon exemptions from the registration and qualification requirements of
such laws. (The parties hereto hereby acknowledge that the Securities
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are sometimes referred to in the real estate documents related to this
transaction as "the Notes.")
SECTION 1.2 Agreement to Sell and Purchase the
Securities.
Subject to the terms and conditions of this Agreement, the
Issuer will sell to the Purchaser, and the Purchaser will buy from the Issuer,
Securities in an aggregate principal amount of (i) $21 million at the First
Closing (as defined in Section 1.3) and (ii) $4 million at the Second Closing
(as defined in Section 1.3), in each case, at a purchase price equal to 100% of
the principal amount of such Securities so issued, plus with respect to the
Second Closing, any amounts due in the event the Purchaser elects to receive a
single certificate in the aggregate principal amount of $25 million as provided
in Section 1.3(a) below.
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SECTION 1.3 Delivery of the Securities; Conditions to
Closing.
(a) The closing of the purchase and sale of the Securities
referred to in clause (i) of Section 1.2 (the "First Closing") shall occur at
10:00 a.m. New York City time, on March 17, 1997 (the "First Closing Date" or
the "First Closing"), and the closing of the purchase and sale of the Securities
referred to in clause (ii) of Section 1.2 (the "Second Closing Date" or the
"Second Closing") shall occur at 10:00 a.m. New York City time, on March 31,
1997 (the "Second Closing Date," and together with the First Closing Date, the
"Closing Dates"), in each case, at the offices of Paul, Hastings, Janofsky &
Walker LLP, 399 Park Avenue, New York, New York 10022 and/or at such later dates
or places as each party hereto shall agree. At the First Closing, the Issuer
shall deliver to the Purchaser one or more certificates representing $21 million
aggregate principal amount of Securities registered in the name of the
Purchaser, or in such name(s) as may be designated by the Purchaser (each, an
"Initial Certificate"). At the Second Closing, the Issuer shall deliver to the
Purchaser one or more certificates representing $4 million aggregate principal
amount of Securities registered in the name of the Purchaser, or in such name(s)
as designated by the Purchaser. At the option of the Purchaser at the Second
Closing, the Purchaser may request from the Issuer and the Issuer shall deliver
to the Purchaser, upon delivery by the Purchaser for cancellation of the Initial
Certificate(s) in the aggregate principal amount of $21 million, together with
the amount in cash of interest due, at an annual rate of 8%, on the amount of $4
million for the period from the First Closing Date to the Second Closing Date, a
single certificate in the aggregate principal amount of $25 million registered
in the name of the Purchaser, or in such name(s) as designated by the Purchaser
for which interest shall accrue on such single certificate from the date of the
First Closing.
(b) The Issuer's obligation to deliver such Securities to the
Purchaser on any Closing Date (each a "Closing", and collectively, the
"Closings"), and the obligation of Lexington and Lex GP-1 to guarantee such
Securities from the effective date of such guarantee shall be subject to the
satisfaction of the following conditions, any one or more of which may be waived
by the Issuer and Lexington in their sole and absolute discretion:
(i) receipt by the Issuer and Lexington of
this Agreement, duly executed by each party hereto:
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(ii) receipt by the Issuer of a wire transfer of
immediately available funds in the full amount of the respective purchase price
due and payable for the Securities being purchased at such Closing hereunder;
(iii) the accuracy, in all material respects, as of
each Closing Date of the representations and warranties made by the Purchaser
herein and the fulfillment, in all material respects, of those undertakings of
the Purchaser to be fulfilled on or prior to each Closing;
(iv) with respect to the Second Closing and in the
event that the Purchaser elects to receive a single certificate in the aggregate
principal amount of $25 million as provided in Section 1.3(a) hereof, receipt by
the Issuer of the Initial Certificate(s) for cancellation plus all interest
amounts due as provided in Section 1.3(a) hereof; and
(v) with respect to the Second Closing, the
cancellation and discharge from public record of the Interim Mortgage (as
defined below) and the Interim Assignment of Leases and Rents (defined below)
executed at the First Closing and recorded, such cancellation and discharge to
occur only after the recordation of the Mortgage and the Assignment of Leases
and Rents and the issuance of the title commitment with respect thereto as
described for the Second Closing in subsection (c)(i)(J) of this Agreement.
(c) The Purchaser's obligation to accept delivery of and to
pay for the Securities at each Closing shall be subject to the satisfaction of
the following conditions, any one or more of which may be waived by the
Purchaser in its sole and absolute discretion:
(i) receipt by the Purchaser of the following
agreements, instruments and documents, in each case in form and substance
reasonably satisfactory to the Purchaser and its counsel:
(A)this Agreement, duly executed by each party
hereto;
(B)the original Securities in the aggregate principal
amount of (i) $21 million, in the case of the First Closing, and (ii) $4
million, in the case of the Second Closing, or $25 million if the Purchaser has
elected to receive a single certificate in the aggregate principal amount of the
Securities received in the First Closing and
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the Second Closing pursuant to Section 3(a) hereof, in each case, in the
denominations requested by the Purchaser;
(C)a duly executed Indenture;
(D)(i) at the First Closing, a duly executed
Mortgage, Assignment of Leases and Rents, Security Agreement and Fixture Filing,
substantially in the form of Exhibit B-1 hereto (the "Interim Mortgage"),
executed by the Issuer, as Mortgagor, in favor of the Trustee, as Mortgagee, to
encumber the real property described on Exhibit C hereto (the "Pennsylvania Real
Property"), and all rights of the Issuer related thereto; and (ii) at the Second
Closing, a duly executed Mortgage, Assignment of Leases and Rents, Security
Agreement and Fixture Filing, substantially in the form of Exhibit B-2 hereto
(the "Mortgage"), executed by the Issuer, as Mortgagor, in favor of the Trustee,
as Mortgagee, to encumber the Pennsylvania Real Property;
(E)(i) at the First Closing, a duly executed
Assignment of Leases and Rents, substantially in the form of Exhibit D-1 hereto
(the "Interim Assignment of Leases and Rents"), made by the Issuer in favor of
the Trustee, and (ii) at the Second Closing, a duly executed Assignment of
Leases and Rents, substantially in the form of Exhibit D-2 hereto (the
"Assignment of Leases and Rents"), executed by the Issuer, as Assignor
Mortgagor, in favor of the Trustee, as Assignee, to encumber the Pennsylvania
Real Property;
(F)a duly executed Registration Rights Agreement,
substantially in the form of Exhibit E hereto (the "Registration Rights
Agreement"), made by the Issuer and Lexington in favor of the Purchaser;
(G)duly executed legal opinions of each of (i) Paul,
Hastings, Janofsky & Walker LLP, counsel to the Issuer and Lexington (who may
rely upon Piper & Marbury as to matters of Maryland law), and (ii) Dechert,
Price & Rhoads, local real estate counsel to the Issuer, each dated as of each
Closing Date, and each issued and addressed to the Placement Agent and the
Purchaser in form and substance acceptable to the Purchaser and its counsel and
to the effect set forth on Exhibits F-1 and F-2, respectively, hereto;
(H)a Confidential Placement Memorandum, dated as of
each Closing Date (the "Private Placement Memorandum");
(I)a certification of (i) any Chief Executive
Officer, President or Vice President and (ii) any
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President, Vice President, Chief Accounting Officer or Treasurer of each of Lex
GP-1 and Lexington, dated as of each Closing Date, that the Private Placement
Memorandum is true and correct in all material respects and does not contain any
untrue statement of a material fact or omit to state a material fact necessary
in order to make the statements made therein, in the light of the circumstances
in which they were made, not misleading;
(J)evidence satisfactory to the Purchaser and its
counsel that a title insurance company reasonably acceptable to the Purchaser
has committed to issue an ALTA title insurance policy acceptable to the
Purchaser and its counsel, in an amount approved by the Purchaser, showing title
to the Pennsylvania Real Property vested in the Issuer, and insuring that the
Interim Mortgage (with respect to the First Closing) and the Mortgage (with
respect to the Second Closing) is a valid first lien on the Pennsylvania Real
Property in favor of the Trustee. Such title policy shall be issued at the First
Closing (and shall be reissued at the Second Closing) and shall contain no
exceptions or conditions other than exceptions and conditions approved in
writing by the Purchaser and its counsel (the "Permitted Exceptions"), and shall
contain such endorsements (excluding zoning) and other coverages and affirmative
statements available under local law as the Purchaser or its counsel may
reasonably require;
(K)an "as-built" survey covering the Pennsylvania
Real Property prepared in accordance with 1992 ALTA/ACSM standards and
containing such other information as will cause the title insurance company to
issue the title policy described in the preceding paragraph and otherwise in a
form reasonably acceptable to the Purchaser and its counsel, together with
evidence as to whether the Pennsylvania Real Property is located in an area
designated by the Department of Housing and Urban Development as having special
flood or mud slide hazards;
(L)a "Phase I" environmental report regarding the
Pennsylvania Real Property;
(M)(i) certificates evidencing insurance, dated as of
a recent date prior to each Closing Date, for the Pennsylvania Real Property in
amount and scope and with loss payment provisions as reasonably provided in the
Mortgage and (ii) tenant estoppel certificates and subordination agreements in
form reasonably satisfactory to the Purchaser and its counsel;
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(N)evidence that the Pennsylvania Real Property is
assessed separately and is apart from any other property for local property tax
purposes;
(O)true and correct copies of all such agreements,
leases and contracts, each as amended to date, relating to the ownership,
operation, management, maintenance, lease and/or development of the Pennsylvania
Real Property and/or provision of services to the Pennsylvania Real Property
which are in Issuer's possession;
(P)such Uniform Commercial Code financing statements
executed by the Issuer as the Purchaser or its counsel may reasonably request
(the "UCC Statements"), together with current UCC, tax, judgment lien and
bankruptcy searches for Pennsylvania and the jurisdiction of organization of
each of the Issuer and Lexington;
(Q)a signature and incumbency certificate of the
officers of each of Lex GP-1 and Lexington executing this Agreement, the
Indenture, the Securities, the Interim Mortgage, the Mortgage, the Interim
Assignment of Leases and Rents, the Assignment of Leases and Rents, the
Registration Rights Agreement, the UCC Statements and any other documents,
instruments and certificates required to be executed by the Issuer or Lexington,
as applicable, in connection herewith or therewith (such agreements, documents,
instruments and certificates other than the Securities are sometimes referred to
hereinafter collectively as the "Documents");
(R)a Certificate of Secretary of each of the Issuer,
Lex GP-1 and Lexington, as applicable, dated as of each Closing Date, in the
form of Exhibit G hereto, certifying as to certain matters and specifically
including:
(x) a certified copy of the (i) Certificate of
Limited Partnership of the Issuer, together with good standing
certificates (including verification of tax status) and
telegrams, if available, from the Secretary of State of the
State of Delaware, and good standing certificates (including
verification of tax status) from each state in which the
Issuer is required to be qualified to transact business as a
foreign limited partnership, to be dated a recent date prior
to each of the Closings and (ii) Certificate of Incorporation
of Lexington, together with good standing certificates
(including verification of tax status) and telegrams, if
available, from the Secretary of
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State of the State of Delaware, in the case of each of clause
(i) and (ii) to be dated a recent date prior to each of the
Closings;
(y) copies of the Issuer's Limited Partnership
Agreement and the Certificate of Incorporation and Bylaws of
each of Lexington and Lex GP-1; and
(z) resolutions of Lex GP-1 and Lexington
approving and authorizing the execution, delivery and
performance of the Documents and the Securities and the
guarantee of the Securities;
(S) a letter from the Issuer addressed to the
Purchaser to the effect that each holder of the Securities (a "Holder") is
entitled to rely on the representations and warranties made by the Issuer in
Section 3.1 of this Agreement and the covenants made by the Issuer in Article 2
of this Agreement (including without limitation the Issuer's covenant to comply
with all provisions of any undertakings contained in the Private Placement
Memorandum), in each case as though such representations, warranties or
covenants had been addressed to such Holders;
(T) a letter from both Lexington and Lex GP-1
addressed to the Purchaser to the effect that each Holder is entitled to rely on
the representations and warranties made by Lexington and Lex GP-1 in Section 3.2
of this Agreement and the covenants made by Lexington and Lex GP-1 in Article 2
of this Agreement (including without limitation Lexington's covenant to comply
with all provisions of any undertakings contained in the Private Placement
Memorandum), in each case as though such representations, warranties or
covenants had been addressed to such Holders;
(U) a duly executed letter from Paul, Hastings,
Janofsky & Walker LLP, counsel to the Issuer and Lexington, addressed to the
Purchaser to the effect that each Holder of the Securities is entitled to rely
on the opinion of such counsel delivered pursuant to Section 1.3(c)(i)(G) of
this Agreement as though such letter had been addressed to such Holders;
(ii) the Interim Mortgage (with respect to the First
Closing) and the Mortgage (with respect to the Second Closing) shall be duly
recorded in the Official Records of each county in the State of Pennsylvania
where a property is located, shall be in a first lien position on the Issuer's
fee estate in the Pennsylvania Real Property and shall be subject only to the
Permitted Exceptions; and
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the Interim Assignment of Leases and Rents (with respect to the First Closing)
and the Assignment of Leases and Rents (with respect to the Second Closing)
shall be duly recorded in such counties and shall be subject only to the
Permitted Exceptions;
(iii) the UCC Statements shall be duly filed in
the Office of the Pennsylvania Secretary of State and in such additional offices
as the Purchaser and its counsel shall reasonably require; and the Purchaser and
its counsel shall have received current searches of the UCC filing records with
the Office of the Pennsylvania Secretary of State, the local recorder's office
in the counties where the properties are located, and such additional offices as
the Purchaser and its counsel shall reasonably require, and such current
searches must show that the property included in the UCC Statements is subject
to no security interests other than those in favor of the Trustee;
(iv) the Pennsylvania Real Property shall be
substantially in compliance with all applicable laws, including, without
limitation, all applicable environmental laws;
(v) there shall be no actions or proceedings
commenced or threatened against the Issuer, Lexington or Lex GP-1 involving the
Pennsylvania Real Property except as may be disclosed, or incorporated by
reference, in the Private Placement Memorandum in connection with Issuer's
acquisition of the Pennsylvania Real Property;
(vi) there shall be no material adverse change in the
physical condition of the Pennsylvania Real Property, including, without
limitation, any damages suffered as a result of an earthquake, a flood or a
fire, whether or not insured;
(vii) the accuracy, in all material respects, as of
each Closing Date of the representations and warranties made by the Issuer,
Lexington and Lex GP-1 in the Documents and the fulfillment, in all material
respects, of those undertakings of the Issuer, Lexington and Lex GP-1 to be
fulfilled prior to Closing;
(viii) payment by the Issuer of the reasonable fees
and expenses of Purchaser's legal counsel (which shall not exceed $100,000); and
(ix) payment by the Issuer of all fees and other
amounts payable to the Placement Agent pursuant to the Placement Agreement.
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ARTICLE 2.
COVENANTS
SECTION 2.1 Organizational Existence.
Each of the Issuer, Lexington and Lex GP-1 shall do or cause
to be done all things necessary to preserve and keep in full force and effect
its respective existence, in accordance with its organizational documents and
its rights (charter and statutory), licenses and franchises; provided, however,
that each of the Issuer, Lexington and Lex GP-1 may merge or consolidate with
any other person or reorganize as a Maryland business trust as permitted by
Article 5 of the Indenture. During the period that the Securities or shares of
Common Stock are outstanding, Lexington, unless otherwise approved by the
Holders of a majority of the outstanding Common Stock as a result of a
transaction permitted by Article 5 of the Indenture, shall maintain (i) its
listing and good standing on the New York Stock Exchange and (ii) its status as
a real estate investment trust in compliance with all applicable provisions of
the Internal Revenue Code of 1986, as amended (the "Code") at all times after
each Closing.
SECTION 2.2 Taxes.
Each of the Issuer, Lexington and Lex GP-1 shall pay prior to
delinquency all taxes, assessments and governmental levies against it or the
Pennsylvania Real Property, as the case may be, except as contested in good
faith and by appropriate proceedings or where (in the case of the Issuer or
Lexington or Lex GP-1, but not the Pennsylvania Real Property) the failure to
pay would not have an Issuer Material Adverse Effect (as defined in Section
3.1(a)) or a Lexington Material Adverse Effect (as defined in Section 3.2(a)).
SECTION 2.3 Investment Company Act.
None of the Issuer, Lexington or Lex GP-1 shall become an
investment company subject to registration under the Investment Company Act of
1940, as amended.
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SECTION 2.4 Use of Proceeds.
The Issuer agrees to use the proceeds from the sale of the
Securities to be purchased hereunder substantially as set forth in the Private
Placement Memorandum under the heading "Use of Proceeds."
SECTION 2.5 [Intentionally left blank.]
SECTION 2.6 Exchange of Securities Outstanding.
Lexington shall, at all times that any Securities remain
outstanding, reserve a number of shares of Common Stock sufficient to provide
for the exchange of all Securities then outstanding in accordance with the terms
of the Indenture, and shall immediately take any such corporate action as may be
necessary in the future to increase the number of its authorized but unissued
shares of Common Stock in the event of a stock split, stock dividend or any
other event which increases the number of shares of Common Stock for which the
Securities may be exchanged.
SECTION 2.7 Notification Regarding Holders Above REIT
Threshold.
The Purchaser will notify the Issuer promptly of the identity
of any person or entity that has or may have acquired, directly or to the
Purchaser's knowledge indirectly, more than 9.8% of the value of the outstanding
shares or other ownership interests in the Purchaser.
SECTION 2.8 Response to Notification Regarding Tenants.
(a) Proposed Tenants. Upon receipt by the Purchaser of
notification from the Issuer specifically naming any proposed tenant, the
Purchaser will promptly notify the Issuer if the Purchaser owned, as of the end
of the immediately preceding quarter, directly or indirectly, (i) ten percent
(10%) or more of the total combined voting power of all classes of such named
tenant's stock entitled to vote, or ten percent (10%) or more of the total
number of shares of all classes of such named tenant's outstanding stock (in the
case of a proposed corporate tenant), or (ii) an interest of at least ten
percent (10%) in the net assets or profits of such named tenant (in the case of
proposed non-corporate tenants).
(b) Existing Tenants. Promptly after the Purchaser's receipt
from the Issuer of a list of specifically-named tenants, the Purchaser shall, by
written
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notice to the Issuer, identify any such named tenant of which the Purchaser
owns, as of the end of the immediately preceding quarter (i) ten percent (10%)
or more of the total combined voting power of all classes of stock entitled to
vote (in the case of corporate tenants), or ten percent (10%) of the total
number of shares of all classes of such named tenant's outstanding stock, or
(ii) ten percent (10%) or greater interest in the net assets or profits (for
proposed non-corporate tenants). The Issuer may exercise such right with respect
to existing tenants no more than once during any calendar quarter (as to any
current tenant accounting for five percent (5%) or more of the aggregate rental
income received by Lexington during the most recent fiscal year for which such
information is available) and no more than once during any calendar year (as to
all other current tenants).
(c) The Purchaser shall send to the Issuer copies of the
Purchaser's periodic reports to shareholders, at the same time and in the same
manner it sends such periodic reports to such shareholders.
(d) The Purchaser shall have no obligation to notify the
Issuer of the Purchaser's ownership interest in any person other than pursuant
to subsection (a), (b) or (c) above, including without limitation any parent,
subsidiary, partner or other affiliate of such tenant, unless the Issuer
separately identifies such parent, subsidiary, partner or affiliate for purposes
of subsection (a) or (b) above.
(e) The Purchaser shall have no liability to any party
resulting from the Purchaser's failure to comply with any provision of this
Section 2.8 unless both (i) such failure is proximately caused by the bad faith
or wilful misconduct or gross negligence of the Purchaser and (ii) the most
recent periodic report delivered to the Issuer under subsection (c) above prior
to such failure does not disclose the Purchaser's ownership of a 10% or greater
ownership interest in such tenant.
(f) Nothing contained in this Section 2.8 shall prohibit the
Purchaser from purchasing or holding (i) any amount of the capital stock or
voting securities in any corporate tenant of the Issuer or the REIT, or (ii) or
any interest in the net assets or profits in any non-corporate tenant of the
Issuer or the REIT.
SECTION 2.9 No Corporate or Partnership Action Resulting
in Redemption.
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<PAGE> 13
None of the Issuer, Lexington or Lex GP-1 shall intentionally
take any corporate action or partnership action, as applicable, (including
without limitation any change in its capital structure) if, immediately after
giving effect to such action, such action could reasonably be expected to result
in a redemption pursuant to Section 5(b) of the Securities.
SECTION 2.10 Notice Regarding Redemption.
In the event of any redemption pursuant to Section 5(b) of the
Securities, the Purchaser shall receive, in addition to any notice of redemption
required to be given by mail under the Indenture, a copy of such notice by
overnight courier, together with a copy of any opinions and officer's
certificates to be delivered to the Trustee.
ARTICLE 3.
REPRESENTATIONS AND WARRANTIES
SECTION 3.1 Representations and Warranties of the Issuer.
As of the date hereof and as of each Closing Date, the Issuer
and Lexington, jointly and severally, represent and warrant to each of the
Purchaser and the Placement Agent that:
(a) Organization and Qualification.
The Issuer is validly existing and in good standing under the
laws of the State of Delaware and is qualified and in good standing under the
laws of all other jurisdictions where the nature of the activities conducted by
it or the character of the assets owned or leased by it makes such licensing or
qualification necessary, except where the failure to be so licensed or qualified
would not, singly or in the aggregate with all other such failures, reasonably
be expected to have a material adverse effect on the condition (financial or
otherwise), business, liabilities (contingent or otherwise), properties, net
worth, solvency or results of operation of the Issuer and its subsidiaries
considered together as a single enterprise (any such effect, an "Issuer Material
Adverse Effect"). The Issuer has the organizational power and authority to own
or lease its properties and to conduct its business as presently conducted.
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<PAGE> 14
(b) Partnership Interests.
The partnership agreement of the Issuer permits the Issuer to
issue the partnership interests referred to in Article 4 of such partnership
agreement. Lex GP-1 is the sole general partner of the Issuer and a wholly owned
subsidiary of Lexington.
(c) Due Execution and Delivery of the Documents.
The Issuer has full partnership power and authority to enter
into the Documents to which it is a party. Each of this Agreement, the
Indenture, the Interim Mortgage, the Mortgage and the other Documents to which
it is a party has been duly authorized, executed and delivered by the Issuer and
constitutes a valid and binding agreement of the Issuer and is enforceable
against the Issuer in accordance with its terms, except as enforceability may be
limited by bankruptcy, insolvency, reorganization and other laws of general
applicability relating to or affecting creditors' rights and to general
principles of equity; provided that any representation with respect to the
enforceability of the Securities to be sold hereunder by the Issuer, is made
solely pursuant to paragraph (d) below.
(d) Sale and Delivery of the Securities.
The Securities to be sold hereunder by the Issuer, when duly
executed by the Issuer and authenticated by the Trustee, will constitute valid
and legally binding obligations of the Issuer, enforceable against the Issuer in
accordance with their terms, except as enforceability may be limited by
bankruptcy, insolvency, reorganization and other laws of general applicability
relating to creditors' rights and to general principles of equity.
(e) Additional Information.
The Issuer has furnished the Private Placement Memorandum to
the Purchaser. The information contained therein is true and correct in all
material respects and does not contain any untrue statement of a material fact
or omit to state a material fact necessary in order to make the statements
therein, in light of the circumstances in which they were made, not misleading.
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<PAGE> 15
(f) Registration.
Assuming the truth and accuracy of the representations of the
Purchaser contained herein, the issuance and sale of the Securities pursuant to
the Private Placement Memorandum and this Agreement is exempt from the
registration provisions of the Securities Act and the registration and/or
qualification provisions of the states of New York and New Jersey governing the
offer and sale of securities.
(g) No Litigation.
Except as set forth, or incorporated by reference, in the
Private Placement Memorandum including the exhibits thereto, there are no
actions, suits or proceedings pending or, to the knowledge of the Issuer,
threatened against or affecting the Issuer, before or by any Federal or state
court, commission, regulatory body, administrative agency or other government
body, domestic or foreign, wherein an unfavorable ruling, decision or finding
would, singly or in the aggregate with all other such actions, suits and
proceedings, reasonably be expected to have an Issuer Material Adverse Effect.
(h) No Consents Required; No Conflict or Breach.
The issuance of the Securities pursuant to the Indenture, the
offering and sale of the Securities to the Purchaser by the Issuer pursuant to
this Agreement and the compliance by the Issuer with the provisions of this
Agreement, the other Documents and the Securities, and the consummation of the
transactions herein contemplated and in the Private Placement Memorandum do not
(i) require the consent, approval, authorization, registration or qualification
of or with any governmental authority, except such as have been obtained, (ii)
result, with exception of the Interim Mortgage, the Mortgage and the other
Documents contemplated thereby, in the creation or imposition of any lien,
charge or encumbrance upon any of the assets of the Issuer, or (iii) conflict
with or result in a breach or violation of any of the terms and provisions of,
or constitute a default under, any indenture, mortgage, deed of trust, lease or
other material agreement or instrument, to which the Issuer is a party or by
which the Issuer or any of its properties are bound, or the organizational
documents or limited partnership agreement of the Issuer or any statute or any
judgment, decree, order, rule or regulation of any court or other governmental
authority or arbitrator applicable to the Issuer or any of its properties.
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<PAGE> 16
(i) Investment Company Act.
The Issuer is not an "investment company" or an "affiliated
person" of, or "promoter" or "principal underwriter" for, an "investment
company," as such terms are defined under the Investment Company Act, and the
Issuer is not required to be registered under the Investment Company Act.
(j) Title.
The Issuer has good and indefeasible title in fee simple to
all real property and interests in real property owned by it and good and
marketable leasehold title to all real property and interests in real property
leased by it, in each case free and clear of all liens, encumbrances and defects
except such as are Permitted Exceptions or are described in the Private
Placement Memorandum or such as do not adversely affect the value of such
property or interests and do not interfere with the use made of such property or
interests by the Issuer; and the instruments securing the Issuer's real estate
mortgage loans create valid first priority liens upon the real properties
described in such instruments, subject only to the Permitted Exceptions or such
other exceptions to title which have no adverse effect on the value of such real
properties and interests.
(k) No Default.
No default exists, and no event has occurred which, with
notice or lapse of time or both, would constitute a default in the due
performance and observance of any term, covenant or condition of any indenture,
mortgage, deed of trust, voting trust agreement, loan agreement, bond,
debenture, note agreement, lease, material contract or other agreement or
instrument to which the Issuer is a party or by which the Issuer or any of its
properties is bound or affected and which would not, singly or in the aggregate
with all other such defaults and potential defaults, reasonably be expected to
have an Issuer Material Adverse Effect.
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<PAGE> 17
(l) Pennsylvania Real Property Leases.
Each lease to which the Pennsylvania Real Property is subject
is valid, subsisting and enforceable, and no default by the Issuer has occurred
and is continuing thereunder, except such as would not, singly or in the
aggregate with all other such defaults, reasonably be expected to have an Issuer
Material Adverse Effect, and to the knowledge of the Issuer, no material default
by any tenant thereunder is existing under any such lease.
SECTION 3.2 Representations and Warranties of Lexington
and Lex GP-1.
Lexington and Lex GP-1 represent and warrant to each of the
Purchaser and the Placement Agent that:
(a) Organization and Qualification.
Lexington is validly existing and in good standing under the
laws of the State of Maryland and is qualified and in good standing under the
laws of all other jurisdictions where the nature of the activities conducted by
it or the character of the assets owned or leased by it makes such licensing or
qualification necessary, except where the failure to be so licensed or qualified
would not, singly or in the aggregate with all other such failures, reasonably
be expected to have a material adverse effect on the condition (financial or
otherwise), business, liabilities (contingent or otherwise), properties, net
worth, solvency or results of operations of Lexington and its subsidiaries,
considered together as a single enterprise (any such effect, a "Lexington
Material Adverse Effect"). Lexington has the corporate power and authority to
own or lease its properties and to conduct its business as presently conducted.
Lex GP-1 is validly existing and in good standing under the
laws of the State of Delaware and is qualified and in good standing under the
laws of all other jurisdictions where the nature of the activities conducted by
it or the character of the assets owned or leased by it makes such licensing or
qualification necessary, except where the failure to be so licensed or qualified
would not, singly or in the aggregate with all other such failures, reasonably
be expected to have a Lexington Material Adverse Effect. Lex GP-1 has the
corporate power and authority to own or lease its properties and to conduct its
business as presently conducted.
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<PAGE> 18
(b) Capitalization of Lexington.
As of December 31, 1996, the authorized capital stock of
Lexington consisted of: (i) 40,000,000 shares of Common Stock; (ii) 10,000,000
shares of preferred stock, par value $.0001 per share (the "Preferred Stock");
and (iii) 40,000,000 shares of excess stock, par value $.0001 per share (the
"Excess Stock"). As of such date (i) 9,426,900, 0, and 0 shares of the Common
Stock, the Preferred Stock and the Excess Stock, respectively, were validly
issued and outstanding, fully paid and nonassessable; and (ii) 3,820,443, 0, and
0 shares of the Common Stock, the Preferred Stock and the Excess Stock,
respectively, were reserved for issuance. Since that time, Lexington has issued
700,000 shares of Preferred Stock and has entered into an agreement providing
for the issuance of an additional 1,300,000 shares of Preferred Stock. On
January 31, 1997, Lexington issued a total of 1,784 shares of Common Stock under
existing employee benefit plans. On February 14, 1997, Lexington issued 10,572
shares of Common Stock under its Dividend Reinvestment Program. There are no
other shares of capital stock of Lexington outstanding and no other outstanding
options, warrants, convertible or exchangeable securities, subscriptions, rights
(including preemptive rights), stock appreciation rights, calls or commitments
of any character whatsoever to which Lexington is a party or may be bound
requiring the issuance or sale of shares of any capital stock of Lexington, and
there are no contracts or other agreements by which Lexington is or may become
bound to issue additional shares of its capital stock or any options, warrants,
convertible or exchangeable securities, subscriptions, rights (including
preemptive rights), stock appreciation rights, calls or commitments of any
character whatsoever relating to such shares.
(c) Due Execution and Delivery of the Documents.
Each of Lexington and Lex GP-1 has full corporate power and
authority to enter into the Documents to which it is a party. Each of this
Agreement, the Indenture, and the other Documents to which either Lexington or
Lex GP-1, as the case may be, is a party has been duly authorized, executed and
delivered by Lexington or Lex GP-1, as the case may be and constitutes a valid
and binding agreement of Lexington or Lex GP-1, as applicable, enforceable
against Lexington or Lex GP-1, as applicable, in accordance with its respective
terms, except as enforceability may be limited by bankruptcy, insolvency,
reorganization and other laws of general applicability relating to or affecting
creditors' rights and to general principles of equity.
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<PAGE> 19
(d) Reservation of Shares.
Lexington has taken all corporate action necessary to
authorize and reserve a sufficient number of shares of authorized but unissued
Common Stock as required to permit the exchange of all of the Securities
pursuant to the Indenture. Any and all shares of Common Stock issued upon
exchange of the Securities will, upon issuance, be validly issued and
outstanding, fully paid and nonassessable; and shall conform to the description
thereof contained in the Private Placement Memorandum.
(e) Additional Information.
Lexington has furnished the Private Placement Memorandum to
the Purchaser. The information contained therein is true and correct in all
material respects and does not contain any untrue statement of a material fact
or omit to state a material fact necessary in order to make the statements
therein, in light of the circumstances in which they were made, not misleading.
(f) Registration.
Assuming the truth and accuracy of the representations of the
Purchaser contained herein, the issuance and sale of the Securities hereunder by
the Issuer, and the issuance of the guarantees thereof by Lexington and Lex
GP-1, pursuant to the Indenture and this Agreement is exempt from the
registration requirements of the Securities Act and the registration and/or
qualification provisions of the states of New York and New Jersey governing the
offer and sale of securities.
(g) No Litigation.
Except as set forth, or incorporated by reference, in the
Private Placement Memorandum, there are no actions, suits or proceedings pending
or, to the knowledge of Lexington and Lex GP-1, threatened against or affecting
Lexington or Lex GP-1 or any of their respective officers in their capacity as
such, before or by any Federal or state court, commission, regulatory body,
administrative agency or other government body, domestic or foreign, wherein an
unfavorable ruling, decision or finding would, singly or in the aggregate with
all other such actions, suits and proceedings, reasonably be expected to have a
Lexington Material Adverse Effect.
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<PAGE> 20
(h) No Consents Required; No Conflict or Breach.
The guarantee of the Securities by Lexington and Lex GP-1
pursuant to the Indenture, the compliance by Lexington and Lex GP-1 with the
provisions of this Agreement, the other Documents and the Securities to which
either of them is a party, and the consummation of the transactions herein
contemplated and in the Private Placement Memorandum do not (i) require the
consent, approval, authorization, registration or qualification of or with any
governmental authority, except such as have been obtained, (ii) result in the
creation or imposition of any lien, charge or encumbrance upon any of the assets
of Lexington or Lex GP-1, or (iii) conflict with or result in a breach or
violation of any of the terms and provisions of, or constitute a default under,
any indenture, mortgage, deed of trust, lease or other material agreement or
instrument, to which either Lexington or Lex GP-1 is a party or by which
Lexington, Lex GP-1 or any of their respective properties are bound, or the
certificate of incorporation or bylaws of Lexington or Lex GP-1 or any statute
or any judgment, decree, order, rule or regulation of any court or other
governmental authority or arbitrator applicable to Lexington or Lex GP-1.
(i) Qualification as a Real Estate Investment
Trust.
Lexington is, and immediately after each Closing will be,
organized in conformity with the requirements for the qualification as a "real
estate investment trust" (a "REIT") under the Code and the rules and regulations
thereunder. Lexington operates, and immediately after each Closing will operate,
in a manner that so qualifies it as a REIT.
(j) Investment Company Act.
Neither of Lexington or Lex GP-1 is an "investment company" or
an "affiliated person" of, or "promoter" or "principal underwriter" for, an
"investment company," as such terms are defined under the Investment Company
Act, and neither of Lexington or Lex GP-1 is required to be registered under the
Investment Company Act.
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<PAGE> 21
(k) No Default.
No default exists, and no event has occurred which, with
notice or lapse of time or both, would constitute a default in the due
performance and observance of any term, covenant or condition of any indenture,
mortgage, deed of trust, voting trust agreement, loan agreement, bond,
debenture, note agreement, lease, material contract or other agreement or
instrument to which Lexington or Lex GP-1 is a party or by which Lexington, Lex
GP-1 or any of their respective properties is bound or affected and which would
have a Lexington Material Adverse Effect.
(l) Lexington has received the consent and authorization of
its Board of Directors to waive the Ownership Limit set forth in Lexington's
Articles of Incorporation as it applies to the Purchaser's acquisition and
holding of the Securities (or the Common Stock into which the Securities are
exchangeable) in connection with the transactions contemplated hereby.
SECTION 3.3 Representations and Warranties and Covenants
of the Purchaser.
(a) The Purchaser hereby represents and warrants to, and
covenants with, the Issuer and Lexington that:
(i) it is knowledgeable, sophisticated and
experienced in making, and is qualified to make, decisions with respect to
investments in securities presenting an investment decision like that involved
in the purchase of the Securities, including investments in securities issued by
the Issuer and Lexington, and has requested, received, reviewed and considered
all information it deems relevant in making an informed decision to purchase the
Securities;
(ii) it is acquiring the Securities for
investment only and with no present intention of distributing any of such
Securities in violation of the registration requirements of the Securities Act
or any state securities laws;
(iii) it will not, directly or indirectly,
voluntarily offer, sell, pledge, transfer or otherwise dispose of (or solicit
any offers to buy, purchase or otherwise acquire or make a pledge of) any of the
Securities except in compliance with the Securities Act, and the rules and
regulations promulgated thereunder;
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<PAGE> 22
(iv) it has, in connection with its decision
to purchase the Securities contemplated hereby, relied solely upon the Private
Placement Memorandum, the representations and warranties of the Issuer and
Lexington contained herein and the other documents, instruments and agreements
delivered pursuant to Section 1.3 hereof; and
(v) it is an institution which is an
"accredited investor" within the meaning of Rule 501 of Regulation D and a
"qualified institutional buyer" within the meaning of Rule 144A promulgated
under the Securities Act.
(b) The Purchaser further represents and warrants to, and
covenants with, the Issuer and Lexington that (i) it has full right, power,
authority and capacity to enter into this Agreement and to consummate the
transactions contemplated hereby and has taken all necessary action to authorize
the execution, delivery and performance of this Agreement, and (ii) upon the
execution and delivery of this Agreement, this Agreement shall constitute a
valid and binding obligation of such Purchaser enforceable in accordance with
its terms except as enforceability may be limited by bankruptcy, insolvency,
reorganization and other laws of general applicability relating to or affecting
creditors' rights and to general principles of equity.
(c) The Purchaser acknowledges and agrees that (i) it is
purchasing securities which have not been registered under the Securities Act;
and (ii) if it should decide to dispose of any part of the Securities, it will
not offer, sell, transfer, pledge, hypothecate or otherwise dispose of any
Securities except (A) pursuant to an effective registration statement under the
Securities Act, (B) pursuant to Rule 144 or Rule 904 under the Securities Act,
or (C) pursuant to any other exemption from, or otherwise in a transaction not
subject to, the registration requirements of the Securities Act, in each case in
accordance with applicable state securities laws and, in the case of an offer,
sale, transfer, pledge, hypothecation or other disposition pursuant to clause
(B) or (C) of this sentence that occurs prior to (x) the date which is three
years (two years for any transfer on or after April 29, 1997) after the later of
the Initial Closing Date and the last date on which the Issuer or any affiliate
of the Issuer was the owner of such Security, or any predecessor thereto and (y)
such other date, if any, as may be required by any subsequent change in
applicable law (the "Resale Restriction Termination Date"), such Securities
shall be accompanied, in the sole discretion of the Issuer, by the following
additional information and documents, as applicable:
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<PAGE> 23
(x) if such Security is being transferred pursuant
to an exemption from registration in accordance
with Rule 144 or Rule 904 under the Securities
Act, a certification to that effect (in
substantially the form of Exhibit H hereto); or
(y) if such Security is being transferred to an
"accredited investor" within the meaning of Rule
501(a) under the Securities Act (an "Accredited
Investor") or a "qualified institutional buyer"
within the meaning of Rule 144A under the
Securities Act ("QIB"), delivery of a Transferee
Letter of Representation in the form of Exhibit
I hereto and an opinion of counsel and/or other
information reasonably satisfactory to the
Issuer to the effect that such transfer is in
compliance with the Securities Act; or
(z) if such Security is being transferred in
reliance on another exemption from the
registration requirements of the Securities Act,
a certification to that effect (in substantially
the form of Exhibit H hereto) and an opinion of
counsel reasonably acceptable to the Issuer to
the effect that such transfer is in compliance
with the Securities Act.
(d) No individual (as determined for purposes of Section
856(h) of the Code) owns, directly or to the Purchaser's knowledge indirectly,
more than 9.8% by value of the Purchaser's outstanding shares.
(e) With respect to the tenants set forth on Exhibit J hereof,
the Purchaser does not, directly or indirectly, own (i) for corporate entities,
ten percent (10%) or more of the total combined voting power of all classes of
stock entitled to vote, or ten percent (10%) or more of the total number of
shares of all classes of its outstanding stock, and (ii) for non-corporate
entities, ten percent (10%) or more of the net assets or profits interests.
-23-
<PAGE> 24
SECTION 3.4 Survival of Representations, Warranties and
Agreement.
Notwithstanding any investigation made by any party to this
Agreement, all covenants, agreements, representations and warranties made by the
Issuer, Lexington, Lex GP-1 or the Purchaser herein, in the Documents, in the
certificates for the Securities delivered pursuant hereto or in any other
document, instrument or agreement delivered pursuant to Section 1.3 hereof shall
survive the execution of this Agreement and shall terminate as to any Security
that is exchanged for Common Stock as provided in the Indenture on the date of
such exchange, and as to any other Security, shall survive so long as such
Security shall remain outstanding.
ARTICLE 4.
MISCELLANEOUS
SECTION 4.1 Notices.
Any notices or other communications required or permitted
hereunder shall be in writing, and shall be sufficiently given only if made by a
nationally-recognized overnight express courier service (which notices or
communications shall be deemed received on the business day received) addressed
as follows:
(A) if to the Issuer, Lexington or Lex GP-1:
Lepercq Corporate Income Fund L.P.
c/o Lexington Corporate Properties, Inc.
355 Lexington Avenue
New York, New York 10017
Attention: T. Wilson Eglin
Phone: 212-692-7242
Fax: 212-986-6972
- with a copy (which shall not constitute
notice) to:
Paul, Hastings, Janofsky & Walker LLP
399 Park Avenue, Thirty First Floor
New York, New York 10022
Attention: Barry A. Brooks
Phone: 212-318-6000
Fax: 212-319-4090
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<PAGE> 25
(B) if to the Purchaser:
Merrill Lynch Global Allocation Fund, Inc.
800 Scudders Mill Road
Plainsboro, New Jersey 08536
Attention: Lisa A. O'Donnell
Phone: 609-282-3444
Fax: 609-282-3323
and to:
Merrill Lynch Asset Management
800 Scudders Mill Road
Plainsboro, New Jersey 08536
Attention: Bradley Lucido, Esq.
Phone: 609-282-1715
Fax: 609-282-0727
(C) if to the Placement Agent:
NatWest Markets
175 Water Street, 20th Floor
New York, New York 10038
Attention: Bradford Wildauer
Phone: 212-602-4800
Fax: 212-602-8035
Each of the parties hereto, by notice to all of the others,
may designate additional or different addresses as shall be furnished in writing
by such party.
SECTION 4.2 Governing Law.
The internal laws of the State of New York shall govern this
Agreement and the Securities without regard to the principles of conflicts of
law thereof.
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<PAGE> 26
SECTION 4.3 Assignability.
The Purchaser may, without the consent or approval of the
Issuer, Lexington or Lex GP-1, assign its rights and obligations under this
Agreement to a person or entity to whom the Purchaser assigns its interest in
the Securities in proportion to the percentage of Securities transferred,
provided that (i) such assignee shall, by acceptance of such assignment, be
bound by the terms of this Agreement, and (ii) no such assignment shall be valid
as to any person or entity who purchases less than Five Hundred Thousand Dollars
($500,000) in aggregate principal amount of the outstanding Securities. Without
the prior written consent of the Purchaser, Lexington may not assign or delegate
its rights or obligations hereunder.
SECTION 4.4 Binding Agreement.
Subject to Section 4.3 hereof, this Agreement shall be binding
upon the heirs and permitted assignees of the parties.
SECTION 4.5 Table of Contents, Headings, Etc.
The table of contents and headings of the Articles and
Sections of this Agreement have been inserted for convenience of reference only,
are not to be considered a part hereof, and shall in no way modify or restrict
any of the terms or provisions hereof.
SECTION 4.6 Severability.
In case any provision in this Agreement shall be invalid,
illegal or unenforceable, the validity, legality and enforceability of the
remaining provisions shall not in any way be affected or impaired thereby.
SECTION 4.7 Counterparts.
This Agreement may be executed in any number of counterparts
by the parties hereto, each of which when so executed shall be deemed to be an
original and all which taken together shall constitute both one and the same
instrument.
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<PAGE> 27
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed as of the date first above written.
ISSUER: LEPERCQ CORPORATE INCOME FUND L.P.
By: LEX GP-1, INC., its General
Partner
By:
------------------------------------
Name:
Title:
GUARANTORS: LEXINGTON CORPORATE PROPERTIES, INC.
By:
------------------------------------
Name:
Title:
LEX GP-1, INC.
By:
------------------------------------
Name:
Title:
PLACEMENT AGENT: NATIONAL WESTMINSTER BANK, NEW YORK
BRANCH
By:
------------------------------------
Name:
Title:
PURCHASER: MERRILL LYNCH GLOBAL ALLOCATION FUND,
INC.
By:
------------------------------------
Name:
Title:
<PAGE> 1
Exhibit 5.2
REGISTRATION RIGHTS AGREEMENT
DATED AS OF MARCH 17, 1997
BY AND AMONG
LEXINGTON CORPORATE PROPERTIES,INC.
LEPERCQ CORPORATE INCOME FUND L.P.
AND
MERRILL LYNCH GLOBAL ALLOCATION
FUND, INC.
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
<S> <C>
1. DEFINITIONS............................................................ -1-
2. EXCHANGE REGISTRATION.................................................. -6-
3. DEMAND REGISTRATION - COMPANY.......................................... -7-
4. DEMAND REGISTRATION - PARTNERSHIP...................................... -8-
5. PIGGYBACK REGISTRATION................................................. -8-
6. BLACKOUT AND HOLDBACK EVENTS........................................... -11-
7. LIQUIDATED DAMAGES..................................................... -12-
8. REGISTRATION PROCEDURES................................................ -13-
9. REGISTRATION EXPENSES.................................................. -20-
10. INDEMNIFICATION AND CONTRIBUTION....................................... -20-
11. RULES 144 AND 144A..................................................... -24-
12. UNDERWRITTEN REGISTRATIONS............................................. -24-
13. MISCELLANEOUS.......................................................... -25-
</TABLE>
(i)
<PAGE> 3
REGISTRATION RIGHTS AGREEMENT
This REGISTRATION RIGHTS AGREEMENT (the "Agreement") dated
as of March 17, 1997, by and among LEXINGTON CORPORATE PROPERTIES, INC., a
Maryland corporation (the "Company"), LEPERCQ CORPORATE INCOME FUND L.P., a
Delaware limited partnership (the "Partnership"), and MERRILL LYNCH GLOBAL
ALLOCATION FUND, INC., a Maryland corporation (the "Purchaser").
This Agreement is made pursuant to the Note Purchase
Agreement dated as of March 17, 1997 among the Company, the Partnership,
National Westminster Bank PLC, New York Branch, as placement agent and the
Purchaser (the "Purchase Agreement"), relating to, among other things, the sale
by the Partnership to the Purchaser of $25,000,000 aggregate principal amount of
the Partnership's 8% Exchangeable Redeemable Secured Notes due 2004 (the
"Securities"), exchangeable for shares of common stock, $0.001 par value, of the
Company (the "Common Stock"). In order to induce the Purchaser to enter into the
Purchase Agreement, the Company and the Partnership have agreed to provide to
the Purchaser and the Holders (as defined herein), among other things, the
registration rights set forth in this Agreement. The execution and delivery of
this Agreement is a condition to the obligations of the Purchaser under the
Purchase Agreement.
In consideration of the foregoing, the parties hereby
agree as follows:
1. DEFINITIONS
As used in this Agreement, the following terms shall have
the meanings specified:
Advice: See Section 8 hereof.
Affiliate: When used with reference to any Person, any
other Person directly or indirectly controlling, controlled by, or under direct
or indirect common control with, the referent Person or such other Person, as
the case may be. For the purposes of this definition, the term "control" when
used with respect to any specified Person means the power to direct or cause the
direction of management or policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "affiliated", "controlling" and "controlled" have meanings
correlative of the foregoing. Neither the Purchaser nor any of its Affiliates
shall, for purposes of this Agreement, the Purchase Agreement or the Indenture,
or the transactions contemplated hereby or thereby, be deemed to be an Affiliate
of the
<PAGE> 4
Company or of any of its subsidiaries or Affiliates solely by reason of
its ownership of the Securities.
Agreement: See the introductory paragraphs hereto.
Blackout Event: Any of the following events: (i) if the
Board determines in good faith that effecting such a registration or continuing
such disposition at such time would have a material adverse effect upon a
proposed sale of all (or substantially all) of the assets of the Company or a
merger, reorganization, recapitalization or similar current transaction
materially affecting the capital structure or equity ownership of the Company,
or (ii) if the Company is in possession of material information which the Board
determines in good faith is not in the best interests of the Company to disclose
in a registration statement at such time.
Blackout Period: See Section 6(a) hereof.
Board: The Board of Directors of the Company.
Claim: See Section 10(a) hereof.
Common Equivalents: As of any date, shares of common stock
then outstanding or issuable upon the conversion, exchange or exercise of any
security convertible into, or exchangeable or exercisable for, shares of common
stock, whether or not such conversion, exchange or exercise right is then
exercisable; provided, however, that Common Equivalents shall not be deemed to
include any stock options granted to officers, employees or directors of the
Company by the Board or a committee thereof.
Company: See the introductory paragraphs hereto.
Demand Effectiveness Date: See Section 4(a) hereof.
Demand Period: See Section 4(a) hereof.
Demand Registration Statement: See Section 4(a) hereof.
Exchange Act: The Securities Exchange Act of 1934, as
amended, and the rules and regulation of the SEC promulgated thereunder.
Exchange Date: The earliest date on which the holder of
any Security shall have the right to exchange such Security for Exchange Shares.
Exchange Registration Statement: See Section 2(a) hereof.
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Exchange Shares: The shares of Common Stock delivered or
to be delivered, as applicable, in connection with the exchange of the
Securities pursuant to the Indenture.
Form S-3: Form S-3 of the SEC under the Securities Act or
any successor form.
General Partner: Lex GP-1, Inc., a Delaware corporation,
and a wholly-owned subsidiary of the Company.
Holdback Period: See Section 6(b) hereof.
Holder: Any registered holder of a Registrable Security or
Registrable Securities.
Indemnified Person: See Section 10(c) hereof.
Indemnifying Person: See Section 10(c) hereof.
Indenture: The indenture, of even date herewith, among the
Partnership, the Company, the General Partner and The Chase Manhattan Bank, as
trustee, pursuant to which the Securities are being issued, as amended or
supplemented from time to time in accordance with the terms thereof.
Inspectors: See Section 8(n) hereof.
Liquidated Damages: See Section 7(a) hereof.
Losses: See Section 10(a) hereof.
NASD: See Section 8(s) hereof.
Other Investors: Any holder of equity securities of the
Company or the Partnership, as applicable, or any securities convertible into or
exercisable or exchangeable for such equity securities, which holder is entitled
by written agreement with the Company or the Partnership, as the case may be,
entered into prior to the date of this Agreement to have some or all of such
securities included in a Registration Statement.
Participant: See Section 10(a) hereof.
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Partnership: See the introductory paragraphs hereof.
Person: An individual, trustee, corporation, partnership,
joint stock company, limited liability company, trust, unincorporated
association, union, business association, firm or other legal entity.
Piggyback Registration Statement: See Section 5(a) hereof.
Prospectus: The prospectus included in any Registration
Statement (including, without limitation, any prospectus subject to completion
and a prospectus that includes any information previously omitted from a
prospectus filed as part of an effective registration statement in reliance upon
Rule 430A promulgated under the Securities Act), as amended or supplemented by
any prospectus supplement, and all other amendments and supplements to the
Prospectus, including post-effective amendments, and all material incorporated
by reference or deemed to be incorporated by reference in such Prospectus.
Purchaser: See the introductory paragraphs hereto.
Purchase Agreement: See the introductory paragraphs
hereto.
Records: See Section 8(n) hereof.
Registrable Securities means any of (i) of the Securities,
(ii) the Exchange Shares and (iii) any other securities issued or issuable with
respect to any Exchange Shares by way of stock dividend or stock split or in
connection with a combination of shares, recapitalization, merger, consolidation
or other reorganization or otherwise. As to any particular Registrable
Securities held by a Holder, such securities shall cease to be Registrable
Securities when (i) a Registration Statement with respect to the exercise or
offering of such securities by the Holder hereof shall have been declared
effective under the Securities Act and such securities shall have been exchanged
or disposed of by such Holder pursuant to such Registration Statement, (ii) such
securities may at the time of determination be sold to the public pursuant to
Rule 144 without any restriction on the amount of securities which may be sold
by such Holder promulgated under the Securities Act without the lapse of any
further time or the satisfaction of any condition, (iii) such securities shall
have been otherwise transferred by such Holder and new certificates for such
securities not bearing a legend restricting further transfer shall have been
delivered by the Company or its transfer agent for the Common Stock, or by the
Partnership or its transfer agent for Securities, as applicable, and subsequent
disposition of such securities shall not require registration or qualification
under the Securities Act or any similar state law then in force, or (iv) such
securities shall have ceased to be outstanding.
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Registration Expenses: See Section 9(b) hereof.
Registration Statement: Any registration statement of the
Company or the Partnership, as applicable, filed with the SEC under the
Securities Act, including the Prospectus, all amendments and supplements to such
registration statement, including post-effective amendments, all exhibits, and
all material incorporated by reference or deemed to be incorporated by reference
in such registration statement.
Requisite Securities: Securities in an aggregate principal
amount of not less than $10,000,000.
Resale Shares: See Section 3(a) hereof.
Rule 144: Rule 144 promulgated under the Securities Act,
as such Rule may be amended from time to time, or any similar rule (other than
Rule 144A) or regulation hereafter adopted by the SEC providing for offers and
sales of securities made in compliance therewith resulting in offers and sales
by subsequent holders that are not affiliates of an issuer of such securities
being free of the registration and prospectus delivery requirements of the
Securities Act.
Rule 144A: Rule 144A promulgated under the Securities Act,
as such Rule may be amended from time to time, or any similar rule (other than
Rule 144) or regulation hereafter adopted by the SEC.
Rule 415: Rule 415 promulgated under the Securities Act,
as such Rule may be amended from time to time, or any similar rule or regulation
hereafter adopted by the SEC.
SEC: The Securities and Exchange Commission or any
successor federal agency charged with the enforcement of the federal securities
laws.
Securities: See the introductory paragraphs hereto.
Securities Act: The Securities Act of 1933, as amended,
and the rules and regulations of the SEC promulgated thereunder.
Shelf Period: See Section 3 hereof.
Shelf Registration Statement: See Section 3(a) hereof.
Shelf Request: See Section 3 hereof.
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Subsidiary: Any corporations of which the Company owns
securities representing a majority of the outstanding voting power or any
partnership of which the Company (or a Subsidiary) is a general partner.
TIA: The Trust Indenture Act of 1939, as amended.
Trustee: The trustee under the Indenture.
Underwritten Offering: A public offering of common stock,
or other securities convertible into, or exercisable or exchangeable for, common
stock that is underwritten on a firm commitment basis; provided that such
offering shall be exclusively for the account of any one or more of the Company,
the Purchaser (or any of its assignees) or Five Arrows Realty Securities L.L.C.,
a Delaware limited liability company (or any of its assignees).
Unregistered Exchange: See Section 3(a) hereof.
2. EXCHANGE REGISTRATION
(a) The Company shall:
(i) file with the SEC a Registration Statement on
an appropriate form (the "Exchange Registration
Statement") in respect of the Exchange Shares for a
primary exchange offering to be made on a continuous basis
by the Company pursuant to Rule 415; and
(ii) subject to Section 6 hereof, cause each such
Exchange Registration Statement to be declared effective
under the Securities Act no later than the Exchange Date.
The Company shall not permit any securities other than the Exchange Shares to be
included in the Exchange Registration Statement.
(b) The Company shall use its reasonable best efforts to
keep the Exchange Registration Statement continuously effective and, subject to
Section 6 hereof, to amend and supplement the Prospectus contained therein in
order to permit such Prospectus to be lawfully delivered until, in each case,
until no Securities remain outstanding.
(c) In connection with the Exchange Registration
Statement, the Company shall:
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(i) mail to each Holder a copy of the Prospectus
forming part of the Exchange Registration Statement;
(ii) otherwise comply in all material respects
with all applicable federal securities laws, rules and
regulations.
(d) Supplements and Amendments. Subject to Section 6
hereof, the Company shall promptly supplement and amend the Exchange
Registration Statement if required by the rules, regulations or instructions
applicable to the registration form used for such Exchange Registration
Statement, if required by the Securities Act, or if reasonably requested by the
Holders of a majority of the Registrable Securities exchangeable pursuant to
such Exchange Registration Statement.
3. DEMAND REGISTRATION - COMPANY
(a) Shelf Registration Statement. If any Holder shall have
exchanged Securities pursuant to the Indenture at a time when the Exchange
Registration Statement (i) is for any reason not effective, (ii) is subject to a
stop order issued by the SEC, or (iii) for any other reason beyond the control
of such Holder is unavailable for use by such Holder (an "Unregistered
Exchange"), then the Company shall file with the SEC within 30 days (60 days if
the Company is not then eligible to use Form S-3 in connection with a secondary
offering) after its receipt of a written request (a "Shelf Request") from such
Holder a "shelf" Registration Statement for an offering to be made on a
continuous basis pursuant to Rule 415 covering all of the Exchange Shares (the
"Shelf Registration Statement") delivered in connection with such Unregistered
Exchange. The Shelf Registration Statement shall be on an appropriate form
permitting registration of such Exchange Shares (the "Resale Shares") for resale
by Holders in the manner or manners designated by them (including, without
limitation, one or more underwritten offerings).
Subject to Section 6 hereof, the Company shall use its
reasonable best efforts to cause the Shelf Registration Statement to be declared
effective under the Securities Act as soon as possible after the filing thereof
and to keep such Shelf Registration Statement continuously effective and to
amend and supplement the prospectus thereof in order to permit such Prospectus
to be lawfully delivered until, in each case, the earlier of (x) two years from
the date of effectiveness (the "Shelf Period") or (y) the date on which all
Resale Shares covered by the Shelf Registration Statement have been sold in the
manner set forth and as contemplated in the Shelf Registration Statement.
(b) Holdback. The Company agrees not to effect any public
sale or distribution of any shares of Common Stock, or any securities
convertible into or exchangeable or exercisable for Common Stock, during the 14
days prior to, and during
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the 90-day period beginning on, the effective date of a Registration Statement
relating to an underwritten public offering of Resale Shares, where the managing
underwriter or underwriters of such offering so requests.
(c) Supplements and Amendments. Subject to Section 6
hereof, the Company shall promptly supplement and amend the Shelf Registration
Statement if required by the rules, regulations or instructions applicable to
the registration form used for such Shelf Registration Statement, if required by
the Securities Act, or if reasonably requested by the Holders of Securities
exchangeable for a majority of the Registrable Securities covered by such Shelf
Registration Statement.
4. DEMAND REGISTRATION - PARTNERSHIP
(a) At any time after the date hereof while the Securities
shall qualify as Registrable Securities, and provided that the Partnership is
then subject to the reporting obligations of the Exchange Act and otherwise
eligible to register the sale of the Securities by such Holders on Form S-3,
Holders owning, individually or in the aggregate, not less than the Requisite
Securities may make a written request that the Partnership register the resale
of the Securities by such Holders under the Securities Act. The Partnership
shall file with the SEC and, subject to Section 6 hereof, use its reasonable
best efforts to cause to become effective under the Securities Act a
registration statement (the "Demand Registration Statement") with respect to
such Registrable Securities within 60 days of receipt of such written request
(such date, a "Demand Effectiveness Date") and to cause such Demand Registration
Statement to remain continuously effective under the Securities Act until such
Securities cease to qualify as Registrable Securities (a "Demand Period"). Any
such request will specify the number of Registrable Securities proposed to be
sold and will also specify the intended method of disposition thereof. The
Partnership shall give written notice of such registration request to all other
Holders of Registrable Securities issued by the Partnership within 15 days after
the receipt thereof. Within 20 days after receipt by any Holder of Registrable
Securities issued by the Partnership of such notice from the Partnership, such
Holder may request in writing that such Holder's Registrable Securities be
included in such Demand Registration Statement and the Partnership shall include
in such Demand Registration Statement the Registrable Securities of any such
Holder requested to be so included (the "Included Securities"). Each such
request by such other Holders shall specify the number of included Securities
proposed to be sold and the intended method of disposition thereof.
(b) No other securities issued by the Partnership except
(i) Registrable Securities held by any Holder, (ii) equity securities to be
offered and sold for the account of the Partnership and (iii) any equity
securities issued by the Partnership held by any Other Investor shall be
included in a Demand Registration. The inclusion of any such
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<PAGE> 11
securities for the account of the Partnership or any other Person shall be on
the same terms as that of the Registrable Securities.
5. PIGGYBACK REGISTRATION
(a) If at any time the Company or the Partnership proposes
to file a Registration Statement with respect to an offering by the Company or
the Partnership, respectively, for its own account or for the account of any of
its security holders of any class of its common equity securities (other than
(i) a Registration Statement on Form S-4 or S-8 (or any substitute form that may
be adopted by the SEC), (ii) a Registration Statement filed in connection with
an exchange offer or offering of securities solely to the existing security
holders of the Company or the Partnership, as applicable or (iii) in connection
with a "roll-up" of partnerships which are Affiliates of the Company), then the
Company (or the Partnership, as applicable) shall give written notice of such
proposed filing to the Holders of Registrable Securities as soon as practicable
(but in no event fewer than 30 days before the anticipated filing date), and
such notice shall offer such Holders the opportunity to have included in a
Registration Statement (a "Piggyback Registration Statement") such number of
shares of Registrable Securities issued by the Company (or the Partnership, as
applicable), as each such Holder may request in writing not later than 20 days
after receipt of such written notice from the Company (or the Partnership, as
applicable), which request shall specify the Registrable Securities intended to
be disposed of by such selling Holder and the intended method of distribution
thereof. The Company or the Partnership, as applicable, shall use its
commercially reasonable efforts to cause the managing underwriter or
underwriters, if any, of such proposed offering to permit the Registrable
Securities requested to be included in a Piggyback Registration Statement to be
included on the same terms and conditions as any similar securities of the
Company or the Partnership, as applicable, included therein, subject to the
restrictions set forth in Section 5(b), and to permit the sale or other
disposition of such Registrable Securities in accordance with the intended
method of distribution thereof. Any selling Holder shall have the right, at any
time prior to the date of the effectiveness of a Piggyback Registration
Statement, to withdraw its request for inclusion of its Registrable Securities
in such Piggyback Registration Statement by giving written notice to the Company
or the Partnership, as applicable, of its request to withdraw. The Company or
the Partnership, as applicable, may withdraw a Piggyback Registration Statement
at any time prior to the time it becomes effective or the Company or the
Partnership, as applicable, may elect to delay the registration; provided,
however, that the Company or the partnership, as applicable, shall give prompt
written notice thereof to participating Holders. The Company or the Partnership,
as applicable, will pay all Registration Expenses in connection with each
registration of Registrable Securities requested pursuant to this Section , and
each Holder of Registrable Securities shall pay all underwriting discounts and
commissions and transfer taxes, if any, relating to the sale or
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<PAGE> 12
disposition of such Holder's Registrable Securities pursuant to a Piggyback
Registration Statement.
No registration effected under this Section 5, and no
failure to effect a registration under this Section 5, shall relieve the Company
or the Partnership of its obligation to effect a registration pursuant to
Section 2 or 3 hereof, respectively, and no failure to effect a registration
under this Section 5 and to complete the sale of securities registered
thereunder in connection therewith shall relieve the Company or the Partnership
of any other obligation under this Agreement.
(b) Priority in Piggyback Registration. In the event of a
registration pursuant to Section 5 hereof involving an underwritten offering, if
the managing underwriter or underwriters of such underwritten offering shall
have informed, in writing, the Company (or the Partnership, as applicable), and
the selling Holders requesting inclusion in such offering that in such
underwriter's or underwriters' opinion the total number of securities which the
Company (or the Partnership, as applicable), the selling Holders and any other
Persons desiring to participate in such registration intend to include in such
offering is such as to adversely affect the success of such offering, then the
Company (or the Partnership, as applicable) will be required to include in such
registration only the amount of securities which it is so advised should be
included in such registration. In such event:
(x) in cases involving a registration initiated by the
Company (or the Partnership, as applicable) for sale of securities
for its own account (and not involving any exercise of "demand"
registration rights), securities shall be included in such
offering in the following order of priority: (i) first, the
securities which the Company (or the Partnership, as applicable)
proposes to register for its own account, (ii) second, provided
that no securities sought to be included by the Company (or the
Partnership, as applicable) for its own account have been excluded
from such registration, the securities which have been requested
to be included in such registration by the Holders of Registrable
Securities and by Other Investors entitled to exercise piggyback
registration rights pursuant to contractual commitments of the
Company (or the Partnership, as applicable) (pro rata based on the
amount of securities held by such Holders and Other Investors),
and (iii) third, provided that no securities sought to be included
by the Company (or the Partnership, as applicable) for its own
account or by such Holders or Other Investors have been excluded
from such registration, securities sought to be included in such
registration for the account of any other Person;
(y) in all other cases, securities shall be included in
such offering in the following order of priority: (i) first, the
securities of any Person whose exercise of a "demand" registration
right pursuant to a contractual commitment of
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<PAGE> 13
the Company (or the Partnership), as applicable) is the basis for
the registration (provided that if such Person is a Holder of
Registrable Securities, as among Holders of Registrable Securities
there shall be no priority and Registrable Securities sought to be
included by Holders of Registrable Securities shall be included
pro rata based on the amount of securities held by such Persons),
(ii) second, provided that no securities of such Person referred
to in the immediately preceding clause (i) have been excluded from
such registration, the securities which have been requested to be
included in such registration by the Holders of Registrable
Securities pursuant to Section 5(a) hereof and by Other Investors
entitled to exercise piggyback registration rights pursuant to
contractual commitments (pro rata based on the amount of
securities held by such Holders and Other Investors) and (iv)
fourth, provided that no securities of any such Holder or Other
Investor have been excluded from such registration, the securities
which the Company (or the Partnership, as applicable) or any other
Person proposes to register.
If, as a result of the provisions of this Section 5(b),
any selling Holder shall not be entitled to include in a Piggyback Registration
Statement all of the Registrable Securities that such selling Holder has
requested to be so included, such selling Holder may elect to withdraw his
request to include Registrable Securities in such Registration Statement.
6. BLACKOUT AND HOLDBACK EVENTS
(a) During any period of up to 120 days' duration
following the occurrence of a Blackout Event (a "Blackout Period"), neither the
Company nor the Partnership shall be required to file, or cause to be declared
effective, under the Securities Act any Registration Statement hereunder, and
the Holders will discontinue (i) the exchange of Securities pursuant to the
Exchange Registration Statement (but not pursuant to any Unregistered Exchange),
(ii) the disposition of Exchange Shares pursuant to a Shelf Registration
Statement and (iii) the disposition of Securities pursuant to a Demand
Registration Statement, as applicable.
(b) The Holders shall not, if requested (pursuant to a
timely written notice) by the managing underwriter or underwriters of an
Underwritten Offering, effect any public or private sale of any Common Stock,
including a sale pursuant to Rule 144 or Rule 144A, during the period ("Holdback
Period") beginning 14 days prior to, and ending 90 days after, the effective
date of the registration statement relating to such Underwritten Offering;
provided, however, that this Section 6(b) shall not preclude or in any way
restrict:
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(x) any sale of Securities by the Holders prior
to the date the Securities first become exchangeable for
Common Stock pursuant to the Indenture,
(y) any sale by any Holder who, immediately prior
to such sale, beneficially owns (directly or indirectly
through Affiliates or otherwise) less than 7.5% of the
Common Equivalents then outstanding,
(z) any sale by the Holders unless the Company
shall have obtained from each officer, director (excluding
non-employee directors) and beneficial owner of 7.5% or
more of the Common Stock then outstanding written
agreements applicable to such Underwritten Offering on
terms substantially similar to those of this Section 6(b).
The foregoing provisions shall not apply to any Holder if
such Holder is prevented by applicable statute or regulation from entering into
any such agreement; provided, however, that any such Holder shall undertake, in
its request to participate in any Underwritten Offering, not to effect any
public sale or distribution of any Registrable Securities commencing on the date
of sale of such Registrable Securities unless it has provided 45 days' prior
written notice of such sale or distribution to the underwriter or underwriters.
(c) The aggregate number of days during which one or more
blackout Periods or Holdback Periods are in effect shall not exceed 120 days
during any 12-month period.
(d) The Company shall promptly notify the Holders ion
writing of any decision not to file a Registration Statement or not to cause a
Registration Statement to be declared effective or to discontinue sales of
Registrable Securities pursuant to this Section 6, which notice shall set forth
the reason for such decision (but not disclosing any nonpublic material
information) and shall include an undertaking by the Company promptly to notify
the Holders as soon as exchanges or sales, as applicable, may resume.
7. LIQUIDATED DAMAGES
(a) The Company, the Partnership and the Purchaser agree
that the Holders of Registrable Securities will suffer damages if either (i) the
Company fails to fulfill its obligations under Section 2 hereof or (ii) the
Partnership fails to fulfill its obligations under Section 4 hereof and that it
would not be feasible to ascertain the extent of such damages with precision.
Accordingly, the Company and the Partnership agree, jointly and severally, to
pay, as liquidated damages ("Liquidated Damages") if for any reason the Exchange
Registration Statement or the Demand Registration Statement is not
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declared effective by the SEC on or prior to the Exchange Date or Demand
Effectiveness Date, as applicable, then, commencing on the day after such
Exchange Date or Demand Effectiveness Date, as applicable, Liquidated Damages
shall accrue on the principal amount of the Securities included or which should
have been included in such Registration Statement at a rate of 0.50% per annum
(which shall be in addition to the stated interest per annum for such events)
for the first 90 days immediately following the day after such Exchange Date or
Demand Effectiveness Date, as applicable, such Liquidated Damages rate
increasing by an additional 0.50% per annum at the beginning of each such
subsequent 980-day period; and
(b) The Company and the Partnership shall notify the
Trustee within one business day after each and every date on which an event
occurs in respect of which Liquidated Damages are required to be paid. Any
amounts of Liquidated Damages due pursuant to Section 7(a) will be payable in
cash semi-annually on each February 1 and August 1 (to the holders of record on
the January 15 and July 15 immediately preceding such dates), commencing with
the first such payment date occurring after any such Liquidated Damages begins
to accrue. The amount of Liquidated Damages will be determined by multiplying
the applicable Liquidated Damages rate by the principal amount of the
Registrable Securities, multiplied by a fraction, the numerator of which is the
number of days such Liquidated Damages rate was applicable during such period
(determined on the basis of a 360-day year comprised of twelve 30-day months
and, in the case of a partial month, the actual number of days elapsed), and the
denominator of which is 360.
8. REGISTRATION PROCEDURES
In connection with the filing of any Shelf Registration
Statement by the Company or any Demand Registration Statement by the
Partnership, the Company of the Partnership, as applicable, shall effect such
registrations to permit the sale of the securities covered thereby in accordance
with the intended method or methods of disposition thereof, and pursuant thereto
and in connection with any such Registration Statement the Company or the
Partnership, as applicable, shall:
(a) Prepare and file with the SEC, a Registration
Statement or Registration Statements as prescribed by Sections 3 or 4 hereof, as
applicable, and, subject to Section 6 hereof, use its reasonable best efforts to
cause each such Registration Statement to become effective and remain effective
as provided herein; provided, however, that, before filing any Registration
Statement or Prospectus or any amendments or supplements thereto, the Company or
the Partnership, as applicable, shall furnish to and afford the Holders of the
Registrable Securities covered by such Registration Statement, and the managing
underwriters, if any, a reasonable opportunity to review copies of all such
documents (including copies of any documents to be incorporated by
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reference therein and all exhibits thereto) proposed to be filed (in each case
at least five business days prior to such filing). The Company or the
Partnership, as applicable, shall not file any Registration Statement or
Prospectus or any amendments or supplements thereto if the Holders of a majority
in aggregate amount of the Registrable Securities covered by such Registration
Statement, their counsel, or the managing underwriters, if any, shall reasonably
object in writing to any information contained therein.
(b) Subject to Section 6 hereof, prepare and file with the
SEC such amendments and post-effective amendments to each Shelf Registration
Statement or Demand Registration Statement, as the case may be, as may be
necessary to keep such Registration Statement continuously effective and usable
for the Shelf Period or the Demand Period, as the case may be; cause the related
Prospectus to be supplemented by any Prospectus supplement required by
applicable law, and as so supplemented to be filed pursuant to Rule 424 (or any
similar provisions then in force) promulgated under the Securities Act; and
comply with the provisions of the Securities Act and the Exchange Act applicable
to it with respect to the disposition of all securities covered by such
Registration Statement as so amended or in such Prospectus as so supplemented.
(c) Notify the selling Holders of Registrable Securities,
their counsel and the managing underwriters, if any, promptly (but in any event
within two business days), and confirm such notice in writing:
(i) when a Prospectus or any Prospectus
supplement or post-effective amendment has been filed,
and, with respect to a Registration Statement or any
post-effective amendment, when the same has become
effective under the Securities Act (including in such
notice a written statement that any Holder may, upon
request, obtain, at the sole expense of the Company or the
Partnership, as applicable, one conformed copy of such
Registration Statement or post-effective amendment
including financial statements and schedules, documents
incorporated or deemed to be incorporated by reference and
exhibits),
(ii) of the issuance by the SEC of any stop order
suspending the effectiveness of a Registration Statement
or of any order preventing or suspending the use of any
preliminary prospectus or the initiation of any
proceedings for that purpose,
(iii) if at any time when a prospectus is
required by the Securities Act to be delivered in
connection with sales of the Registrable Securities by the
Holders thereof the representations and warranties of the
Company or the Partnership, as applicable, contained in
any agreement
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(including any underwriting agreement), contemplated by
Section 8(n) hereof cease to be true and correct in all
material respects,
(iv) of the receipt by the Company or the
Partnership of any notification with respect to the
suspension of the qualification or exemption from
qualification of a Registration Statement or any of the
Registrable Securities or the Resale Shares to be sold by
any Holder thereof for offer or sale in any jurisdiction,
or the initiation or threatening of any proceeding for
such purpose,
(v) of the happening of any event, or any
information becoming known that makes any statement made
in such Registration Statement or related Prospectus or
any document incorporated or deemed to be incorporated
therein by reference untrue in any material respect or
that requires the making of any changes in or amendments
or supplements to such Registration Statement, Prospectus
or documents so that, in the case of the Registration
Statement, it will not contain any untrue statement or a
material fact or omit to state any material fact required
to be stated therein or necessary to make the statements
therein, not misleading, and that in the case of the
Prospectus, it 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
(vi) of the determination by the Company or the
Partnership, as applicable, that a post-effective
amendment to a Registration Statement would be
appropriate.
(d) Use its reasonable best efforts to prevent the
issuance of any order suspending the effectiveness of a Registration Statement
or of any order preventing or suspending the use of a Prospectus or suspending
the qualification (or exemption from qualification) of any of the Registrable
Securities, for sale in any jurisdiction, and, if any such order is issued, to
use its reasonable best efforts to obtain the withdrawal of any such order at
the earliest practicable moment.
(e) If requested by the managing underwriter or
underwriters (if any), or the Holders of a majority in aggregate amount of the
Registrable Securities being sold in connection with an underwritten offering
(i) promptly incorporate in a prospectus supplement or post-effective amendment
such information as the managing underwriter or underwriters (if any), such
Holders, or counsel for any of them determine is reasonably necessary to be
included therein, and (ii) make all legally required filings of such prospectus
supplement or such post-effective amendment as soon as practicable after the
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<PAGE> 18
Company or the Partnership, as the case may be, has received notification of the
matters to be incorporated in such prospectus supplement or post-effective
amendment.
(f) Furnish to each selling Holder of Registrable
Securities and to their respective counsel and each managing underwriter, if
any, at the sole expense of the Company or the Partnership, as applicable, one
conformed copy of the Registration Statement or Registration Statements and each
post-effective amendment thereto, including financial statements and schedules,
and, if requested, all documents incorporated or deemed to be incorporated
therein by reference and all exhibits.
(g) Deliver to each selling Holder of Registrable
Securities, such Holder's counsel, and the underwriters, if any, at the sole
expense of the Company or the Partnership, as applicable, as many copies of the
Prospectus or Prospectuses (including each form of preliminary prospectus) and
each amendment or supplement thereto and any documents incorporated by reference
therein as such Persons may reasonably request; and, subject to the last
paragraph of this Section 8, the Company and the Partnership hereby consent to
the use of such Prospectus and each amendment or supplement thereto by each of
the selling Holders of Registrable Securities and the underwriters or agents, if
any, and dealers (if any), in connection with the offering and sale of the
Registrable Securities covered by, pursuant to, such Prospectus and any
amendment or supplement thereto.
(h) Prior to any public offering of Registrable
Securities, to use its reasonable best efforts to register or qualify, and to
cooperate with the selling Holders of Registrable Securities, the managing
underwriter or underwriters, if any, and their respective counsel in connection
with the registration or qualification (or exemption from such registration or
qualification) of such Registrable Securities for offer and sale under the
securities or blue sky laws of such jurisdictions within the United States as
any selling Holder, or the managing underwriter or underwriters reasonably
request; keep each such registration or qualification (or exemption therefrom)
effective during the period such Registration Statement is required to be kept
effective and do any and all other acts or things reasonably necessary or
advisable to enable the disposition in such jurisdictions of the Registrable
Securities covered by the applicable Registration Statement; provided, however,
that neither the Company nor the Partnership shall be required to (A) qualify
generally to do business in any jurisdiction where it is not then so qualified,
or (B) take any action that would subject it to general service of process in
any such jurisdiction where it is not then so subject.
(i) Cooperate with the reselling Holders of Registrable
Securities and the managing underwriter or underwriters, if any, to facilitate
the timely preparation and delivery of certificates representing Registrable
Securities to be sold, which certificates shall not bear any restrictive legends
and shall be in a form eligible for deposit with The
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<PAGE> 19
Depository Trust Company (in the case of the Securities) or in compliance with
any applicable rules of a stock exchange on which the Common Stock is then
listed (in the case of the Exchange Shares or the Resale Shares); and enable
such Registrable Securities to be in such denominations and registered in such
names as the managing underwriter or underwriters, if any, or Holders may
request.
(j) Use its reasonable best efforts to cause the
Registrable Securities covered by the Registration Statement to be registered
with or approved by such other governmental agencies or authorities as may be
reasonably necessary to enable the seller or sellers thereof or the underwriter
or underwriters, if any, to consummate the disposition of such Registrable
Securities, except as may be required solely as a consequence of the nature of
such selling Holder's business, in which case the Company and the Partnership
will cooperate in all reasonable respects with the filing of such Registration
Statement and the granting of such approvals.
(k) Upon the occurrence of any event contemplated by
paragraph 6(c)(v) or 6(c)(vi) hereof, as promptly as practicable prepare and
(subject to Section 8(a) hereof) file with the SEC, at the sole expense of the
Company or the Partnership, as applicable, a supplement of post-effective
amendment to the Registration Statement or a supplement of the related
Prospectus or any document incorporated or deemed to be incorporated therein by
reference, or file any other required document so that, as thereafter delivered
to the purchasers of the Registrable Securities being sold thereunder, any such
Prospectus will not contain an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading.
(l) Prior to the effective date of the first Demand
Registration Statement relating to the Registrable Securities which constitute
debt, (i) provide the Trustee with certificates for such Registrable Securities
in a form eligible for deposit with The Depository Trust Company and (ii)
provide a CUSIP number for the Registrable Securities.
(m) In connection with any underwritten offering of
Registrable Securities, enter into an underwriting agreement as is customary in
underwritten offerings of debt securities similar to the Securities or of common
equity similar to the Common Stock, as applicable, and take all such other
actions as are reasonably requested by the managing underwriter or underwriters
in order to expedite or facilitate the registration or the disposition of such
Registrable Securities and, in such connection,
(i) make such representations and warranties to,
and covenants with, the underwriters with respect to the
business of the Company and its Subsidiaries or the
Partnership, as applicable (including any acquired
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<PAGE> 20
business, properties or entity, if applicable), and the
Registration Statement, Prospectus and documents, if any,
incorporated or deemed to be incorporated by reference
therein, in each case, as are customarily made by issuers
to underwriters in underwritten offerings of securities
similar to the Securities or of common equity similar to
the Common Stock, as applicable, and confirm the same in
writing if and when requested;
(ii) obtain the written opinions of counsel to
the Company or the Partnership, as applicable, in form,
scope and substance reasonably satisfactory to the
managing underwriter or underwriters, addressed to the
underwriters covering the matters customarily covered in
opinions requested in underwritten offerings and such
other matters as may be reasonably requested by the
managing underwriter or underwriters;
(iii) obtain "comfort" letters and updates
thereof in form, scope and substance reasonably
satisfactory to the managing underwriter or underwriters
from the independent certified public accountants of the
Company (and, if necessary, any other independent
certified public accountants of any Subsidiary or of any
business acquired by the Company for which financial
statements and financial data are, or are required to be,
included or incorporated by reference in the Registration
Statement) or the Partnership, as applicable, addressed to
each of the underwriters, such letters to be in customary
form and covering matters of the type customarily covered
in "comfort" letters in connection with underwritten
offerings and such other matters as reasonably requested
by the managing underwriter or underwriters as permitted
by the Statement on Auditing Standards No. 72; and
(iv) if an underwriting agreement is entered
into, the same shall contain indemnification provisions
and procedures no less favorable than those set forth in
Section 9 hereof (or such other provisions and procedures
acceptable to Holders of a majority in aggregate amount of
Registrable Securities covered by such Registration
Statement and the managing underwriter or underwriters or
agents) with respect to all parties to be indemnified
pursuant to said Section . The above shall be done at each
closing under such underwriting agreement, or as and to
the extent required thereunder.
(n) Make available for inspection by any underwriter
participating in any such disposition of Registrable Securities, if any, and any
attorney, accountant or other agent retained by any such underwriter
(collectively, the "Inspectors"), at the
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<PAGE> 21
offices where normally kept, during reasonable business hours, all financial and
other records, pertinent corporate documents and instruments of the Company and
its Subsidiaries or the Partnership, as applicable (collectively, the
"Records"), as shall be reasonably necessary to conduct a reasonable
investigation within the meaning of Section 11 of the Securities Act, and cause
the officers, directors and employees of the Company and its Subsidiaries, or
the Partnership, as applicable, to supply all information reasonably requested
by any such Inspector in connection with such Registration Statement.
(o) Solely in the case of a Demand Registration Statement,
cause the Indenture to be qualified under the TIA not later than the effective
date of the Demand Registration Statement; and execute, and use its best efforts
to cause the trustee under the Indenture to execute, all forms and documents as
may be required to be filed with the SEC to enable such Indenture to be so
qualified in a timely manner.
(p) Comply with all applicable rules and regulations of
the SEC and make generally available to its securityholders earnings statements
satisfying the provisions of Section 11(a) of the Securities Act and Rule 158
thereunder (or any similar rule promulgated under the Securities Act) no later
than 45 days after the end of any 12- month period (or 90 days after the end of
any 12-month period if such period is a fiscal year (i) commencing at the end of
any fiscal quarter in which Registrable Securities are sold to Underwriters in a
firm commitment or best efforts underwritten offering and (ii) if not sold to
underwriters in such an offering, commencing on the first day of the first
fiscal quarter of the Company or the Partnership, as applicable, after the
effective date of a Registration Statement, which statements shall cover said
12-month periods.
(q) Cooperate with each seller of Registrable Securities
covered by any Registration Statement and each underwriter, if any,
participating in the disposition of such Registrable Securities and their
respective counsel in connection with any filings required to be made with the
National Association of Securities Dealers, Inc. (the "NASD").
(r) Use its reasonable best efforts to cause all
Registrable Securities relating to any Shelf Registration Statement to be listed
on each securities exchange, if any, on which similar securities issued by the
Company are then listed.
(s) Use its reasonable best efforts to take all other
steps reasonably necessary or advisable to effect the registration of the
Registrable Securities covered by a Registration Statement.
The Company or the Partnership, as applicable, may require
each seller of Registrable Securities as to which any registration is being
effected to furnish to the
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<PAGE> 22
Company or the Partnership, as applicable, such information regarding such
seller and the distribution of such Registrable Securities as the Company or the
Partnership, as applicable, may, from time to time, reasonably request. The
Company or the Partnership, as applicable, may, from time to time, reasonably
request. The Company or the Partnership may exclude from such registration the
Registrable Securities of any seller so long as such seller fails to furnish
such information within a reasonable time after receiving such request. Each
seller as to which any Shelf Registration Statement is being effected agrees to
furnish promptly to the Company or the Partnership, as applicable, all
information required to be disclosed in order to make the information previously
furnished to the Company or the Partnership, as applicable, by such seller not
materially misleading.
If any such Registration Statement refers to any Holder by
name or otherwise as the holder of any securities of the Company or the
Partnership, then such Holder shall have the right to require (i) the insertion
therein of language, in form and substance reasonably satisfactory to such
Holder, to the effect that the holding by such Holder of such securities is not
to be construed as a recommendation by such Holder of the investment quality of
the securities covered thereby and that such holding does not imply that such
Holder will assist in meeting any future financial requirements of the Company
or the Partnership, or (ii) in the event that such reference to such Holder by
name or otherwise is not required by the Securities Act or any similar federal
statute then in force, the deletion of the reference to such Holder in any
amendment or supplement to the Registration Statement filed or prepared
subsequent to the time that such reference ceases to be required.
Each Holder of Registrable Securities agrees by
acquisition of such Registrable Securities that, upon actual receipt of any
notice from the Company or the Partnership, as applicable, of the happening of
any event of the kind described in Section 8(c)(ii), 8(c)(iv), 8(c)(v), or
8(c)(vi) hereof, such Holder will forthwith discontinue disposition of such
Registrable Securities covered by such Registration Statement or Prospectus to
be sold by such Holder until such Holder's receipt of the copies of the
supplemented or amended Prospectus contemplated by Section 8(k) hereof, or until
it is advised in writing (the "Advice") by the Company or the Partnership, as
applicable, that the use of the applicable Prospectus may be resumed, and has
received copies of any amendments or supplements thereto. In the event the
Company or the Partnership shall give any such notice, each of the Shelf Period
and the Demand Period shall be extended by the number of days during such
periods from and including the date of the giving of such notice to and
including the date when each seller of Registrable Securities covered by such
Registration Statement, as the case may be, shall have received (x) the copies
of the supplemented or amended Prospectus contemplated by Section 8(k) hereof or
(y) the Advice.
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<PAGE> 23
9. REGISTRATION EXPENSES
(a) All Registration Expenses incident to the compliance
with this Agreement by the Company shall be borne by the Company. All
Registration Expenses incident to the compliance with this Agreement by the
Partnership shall be borne jointly and severally by the Partnership and the
Company. Notwithstanding the foregoing, the sellers of the Registrable
Securities being registered shall pay all (i) brokerage or underwriting fees,
discounts and commissions attributable to the sale of such Registrable
Securities, (ii) the fees and disbursements of any counsel or other advisors or
experts retained by such sellers (severally or jointly), other than the counsel
and experts specifically referred to in Section 9(b) hereof, (iii) transfer
taxes on resale of any of the Registrable Securities by such sellers and (iv)
any advertising expenses incurred by or on behalf of such sellers in connection
with any offers they may make.
(b) For purposes of this Agreement, "Registration
Expenses" shall mean all fees and expenses incident to the compliance with this
Agreement by the Company or the Partnership, as the case may be (other than fees
and expenses referred to in the second sentence of Section 9(a) hereof),
including, without limitation, (i) all registration and filing fees, including,
without limitation, (A) and SEC or NASD filing fees and (B) fees and expenses of
compliance with state securities or blue sky laws (including, without
limitation, reasonable fees and disbursements of counsel in connection therewith
but limited to one counsel for all of the Sellers of Registrable Securities),
(ii) printing expenses, including, without limitation, expenses of printing
certificates for Registrable Securities in a form eligible for deposit with The
Depository Trust Company and of printing prospectuses if the printing of
prospectuses is requested by the managing underwriter or underwriters, if any,
or by the Holders of a majority of the Registrable Securities included in any
Registration Statement, as the case may be, (iii) messenger, telephone and
delivery expenses incurred by the Company, (iv) all fees and disbursements of
counsel for the Company or the Partnership and fees and disbursements of one
special counsel for all of the sellers of Registrable Securities, (v) fees and
expenses of all other Persons retained by the Company or the Partnership
including annual or special audit and "comfort" letters, (vi) stock exchange
listing fees and expenses, if any, and (vii) the expenses relating to printing
and distributing all Registration Statements, underwriting agreements,
indentures and any other documents necessary in order to comply with this
Agreement.
10. INDEMNIFICATION AND CONTRIBUTION
(a) The Company and the Partnership jointly and severally
agree to identify and hold harmless each Holder of Registration Securities, the
officers, directors and investment advisor, if any, of each such Person, and
each Person, if any, who controls any such Person within the meaning of either
Section 15 of the Securities Act or
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<PAGE> 24
Section 20 of the Exchange Act (each, a "Participant"), from and against any and
all losses, claims, damages and liabilities (collectively, "Losses") (including,
without limitation, the reasonable legal fees and other expenses actually
incurred in connection with any suit, action, proceeding (including any
governmental or regulatory investigation), claim or demand (an "Claim")) caused
by, arising out of or based upon any untrue statement or alleged untrue
statement of a material fact contained in any Registration Statement (or any
amendment thereto) or Prospectus (as amended or supplemented from time to time)
or any preliminary prospectus, or caused by, arising out of or based upon any
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein, in the case of the
Prospectus in light of the circumstances under which they were made, not
misleading, except insofar as such Losses are caused by any untrue statement or
omission or alleged untrue statement or omission made in reliance upon and in
conformity with information relating to any Participant furnished to the Company
or the Partnership, as applicable, in writing by such Participant expressly for
use therein; provided, however, that the Company will not be liable if such
untrue statement or omission or alleged untrue statement or omission was
contained or made in any preliminary prospectus and corrected in the Prospectus
or any amendment or supplement thereto and the Prospectus does not contain any
other untrue statement or omission or alleged untrue statement or omission of a
material fact that was the subject matter of the related proceeding and any such
Indemnifiable Loss suffered or incurred by the Participants resulted from any
Claim by any Person who purchased Registrable Securities which are the subject
thereof from such Participant and it is established in the related proceeding
that such Participant failed to deliver or provide a copy of the Prospectus (as
amended or supplemented) to such Person with or prior to the confirmation of the
sale of such Registrable Securities sold to such Person if required by
applicable law, unless such failure to deliver or provide a copy of the
Prospectus (as amended or supplemented) was a result of noncompliance by the
Company or the Partnership with this Agreement.
(b) Each Participant agrees, severally and not jointly, to
indemnify and hold harmless the Company, its directors, its officers who sign
the Registration Statement, the Partnership, any General Partner, any directors
of the General Partner, any officers of the General Partner who sign a
Registration Statement and each Person who controls the Company or the
Partnership within the meaning of Section 15 of the Securities Act or Section 20
of the Exchange Act to the same extent as the foregoing indemnity from the
Company and the Partnership to each Participant, but only with the reference to
information relating to such Participant expressly for use in such Registration
Statement or Prospectus, any amendment or supplement thereto, or any preliminary
prospectus. The liability of any Participant under this paragraph shall in no
event exceed the proceeds received by such Participant from sales of Registrable
Securities giving rise to such obligations.
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<PAGE> 25
(c) If any Claim shall be brought or asserted against any
Person in respect of which indemnity may be sought pursuant to either of the two
preceding paragraphs, such Person (the "Indemnified Person") shall promptly
notify the Person against whom such indemnity may be sought (the "Indemnifying
Person") in writing, and the Indemnifying Person shall retain counsel reasonably
satisfactory to the Indemnified Person to represent the Indemnified Person and
any others the Indemnifying Person may reasonably designate in such Claim and
shall pay the reasonable fees and expenses actually incurred by such counsel
related to such proceeding; provided, however, that the failure to so notify the
Indemnifying Person shall not relieve it of any obligation or liability which it
may have hereunder or otherwise. In any such proceeding, any Indemnified Person
shall have the right to retain its own counsel, but the fees and expenses of
such counsel shall be at the expense of such Indemnified Person unless (i) the
Indemnifying Person and the Indemnified Person shall have mutually agreed to the
contrary, (ii) the Indemnifying Person shall have failed within a reasonable
period of time to retain counsel reasonably satisfactory to the Indemnified
Person or (iii) the named parties in any such proceeding (including any
impleaded parties) include both the Indemnifying Person and the Indemnified
Person or any affiliate and representation of both parties by the same counsel
would be inappropriate due to actual or potential differing interests between
them. The Indemnifying Person shall not, in connection with any one such
proceeding or separate but substantially similar related proceedings in the same
jurisdiction arising out of the same general allegations, be liable for the fees
and expenses of more than one separate firm (in addition to any local counsel)
for all Indemnified Persons, and all such fees and expenses shall be reimbursed
promptly as they are incurred. If the Company shall be the Indemnifying Person,
any such separate firm for the Indemnified Persons shall be designated in
writing by Participants who sold a majority in interest of Registrable
Securities sold by all such Participants and reasonably acceptable to the
Company or the Partnership, as applicable. If the Company or the Partnership
shall be the Indemnified Person, any such separate firm for the Company, its
directors, its officers, the Partnership, any General Partner, any directors of
the General Partner, any officers of the General Partner who sign a Registration
Statement and such control Persons of the Company or the Partnership, as
applicable, shall be designated in writing by the Company or the Partnership, as
applicable. No Indemnifying Person shall be liable for any settlement of any
proceeding effected without its prior written consent (which consent shall not
be unreasonably withheld or delayed), but if settled with such consent or if
there be a final judgment for the plaintiff for which the Indemnified Person is
entitled to indemnification pursuant to this Agreement, the Indemnifying Person
shall indemnify and hold harmless each Indemnified Person from and against any
loss or liability by reason of such settlement or judgment. No Indemnifying
Person shall, without the prior written consent of the Indemnified Persons
(which consent shall not be unreasonably withheld or delayed), effect any
settlement or compromise of any pending or threatened proceeding in respect of
which any Indemnified Person is or could have been a party, or indemnity could
have been sought hereunder by such Indemnified
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<PAGE> 26
Person, unless such settlement involves only the payment of money damages that
are actually paid by the Indemnifying Person or includes an unconditional
written release of such Indemnified Person, in form and substance reasonably
satisfactory to such Indemnified Person, from all liability on claims that are
the subject matter of such proceeding.
(d) If the Indemnification provided for in the first and
second paragraphs of this Section 10 is for any reason unavailable to, or
insufficient to hold harmless, an Indemnified Person in respect of any Losses,
then each Indemnifying Person under such paragraphs, in lieu of indemnifying
such Indemnified Person thereunder and in order to provide for just and
equitable contribution, shall contribute to the amount paid or payable by such
Indemnified Person as a result of such Losses, in such proportion as is
appropriate to reflect the relative fault of the Indemnifying Person or Persons
on the one hand and the Indemnified Person or Persons on the other in connection
with the statements or omissions or alleged statements or omissions that
resulted in such Losses (or actions in respect thereof) as well as any other
relevant equitable considerations. 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 Indemnifying Person on
the one hand or such Indemnified Person, as the case may be, on the other, the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission, and any other equitable
considerations appropriate in the circumstances.
(e) The parties agree that it would not be just and
equitable if contribution pursuant to this Section 10 were determined by pro
rata allocation or by any other method of allocation that does not take account
of the equitable considerations referred to in the immediately preceding
paragraph. The amount paid or payable by an Indemnified Person as a result of
the Losses referred to in the immediately preceding paragraph shall be deemed to
include, subject to the limitations set forth above, any reasonable legal or
other expenses actually incurred by such Indemnified Person in connection with
investigating or defending any such Claim. Notwithstanding the provisions of
this Section 11, in no event shall a Participant be required to contribute any
amount in excess of the amount by which proceeds received by such Participant
from sales of Registrable Securities exceeds the amount of any damages that such
Participant has otherwise been required to pay or has paid by reason of such
untrue or alleged untrue statement or omission or alleged omission. No Person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Securities Act) shall be entitled to contribution from any Person who was
not guilty of such fraudulent misrepresentation.
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<PAGE> 27
(f) Any Losses for which an indemnified party is entitled
to indemnification or contribution under this Section shall be paid by the
Indemnifying Person to the Indemnified Person as such Losses are incurred. The
indemnity and contribution agreements contained in this Section 8 and the
representations and warranties of the Company and the Partnership set forth in
this Agreement shall remain operative and in full force and effect regardless of
(i) any investigation made by or on behalf of any of the Purchaser, any Holder,
any person who controls the Purchaser or any Holder, or any officers or
directors of the Purchaser or such Holder, and (ii) any termination of this
Agreement.
(g) The indemnity and contribution covenants contained in
this Section 8 are in addition to any liability which any Indemnifying Person
may otherwise have to any Indemnified Person.
11. RULES 144 AND 144A
(a) The Company will file the reports required to be filed
by it under the Exchange Act in a timely manner in accordance with the
requirements of the Exchange Act and, if at any time the Company is not required
to file such reports, it will, upon the request of any Holder of Registrable
Securities issued by the Company, make available such information necessary to
permit sales pursuant to Rule 144A. The Company will also take such further
action as any Holder of Registrable Securities issued by the Company may
reasonably request, to the extent required from time to time to enable such
holder to sell Registrable Securities without registration under the Securities
Act within the limitation of the exemptions provided by Rule 144(k) and Rule
144A.
(b) The Partnership will file the reports, if any,
required to be filed by it under the Exchange Act in a timely manner in
accordance with the requirements of the Exchange Act and, if at any time the
Partnership is not required to file such reports, it will, upon the request of
any Holder or Registrable Securities issued by the Partnership, make available
such information necessary to permit sales pursuant to Rule 144A. The
Partnership will also take such further action as any Holder or Registrable
Securities issued by the Partnership may reasonably request, all to the extent
required from time to time to enable such holder to sell Registrable Securities
without registration under the Securities Act within the limitation of the
exemptions provided by Rule 144(k) and Rule 144A (it being expressly understood
that the foregoing shall not create any obligation on the part of the
Partnership to file periodic or other reports under the Exchange Act at any time
that it is not then required to do so).
12. UNDERWRITTEN REGISTRATIONS
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<PAGE> 28
If any of the Registrable Securities covered by any
Registration Statement are to be sold in an underwritten offering which the
Holders have initiated, the investment banker or investment bankers and manager
or managers that will manage the offering will be selected by the Holders of a
majority in aggregate amount (or, in the case of equity securities, a majority
in number) of such Registrable Securities included in such offering and
reasonably acceptable to the Company.
No Holder of Registrable Securities may participate in any
underwritten registration hereunder unless such Holder (a) agrees to sell such
Holder's Registrable Securities on the basis provided in any underwriting
arrangements approved by the Persons entitled hereunder to approve such
arrangements and (b) completes and executes all questionnaires, indemnities,
underwriting agreements and other documents required under the terms of such
underwriting arrangements and consistent with the terms of this Agreement.
13. MISCELLANEOUS
(a) Remedies. Each of the Company and the Partnership
agrees that monetary damages (including the liquidated damages contemplated
hereby) would not be adequate compensation for any loss incurred by reason of a
breach by it of the provisions of this Agreement and hereby agrees to waive the
defense in any action for specific performance that a remedy at law would be
adequate.
(b) No Inconsistent Agreements. Neither the Company nor
the Partnership has, as of the date hereof, and neither the Company nor the
Partnership shall, after the date of this Agreement without the express written
consent of the Holders of a majority in principal amount (or in the case of
equity securities, a majority in number) of the Registrable Securities, enter
into any agreement with respect to any of its securities that is inconsistent
with the rights granted to the Holders of Registrable Securities in this
Agreement or otherwise conflicts with the provisions hereof, including without
limitation any agreement with respect t;o the securities of the Company, which
grants registration rights to anyone so as to treat such party as having any
priority to or equal consideration with the Holders in determining preference
for inclusion in an Registration Statement prepared by the Company. The rights
granted to the Holders of Registrable Securities hereunder do not in any way
conflict with and are not inconsistent with the rights granted to the holders of
the other outstanding securities of the Company or the Partnership.
(c) Amendments and Waivers. The provisions of this
Agreement may not be amended, modified or supplemented and waivers or consents
to departures from the provisions hereof may not be given, otherwise than with
the prior written consent of (I) the Company and the Partnership and (II) the
Holders of not less than a majority in aggregate amount of the then-outstanding
Registrable Securities; provided, however, that
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Section 8 and this Section 13(c) may not be amended, modified or supplemented
without the prior written consent of each Holder (including any person who was a
Holder of Registrable Securities disposed of pursuant to any Registration
Statement) affected by any such amendment, modification or supplement.
Notwithstanding the foregoing, a waiver or consent to depart from the provisions
hereof with respect to a matter that relates exclusively to the rights of
Holders of Registrable Securities whose securities are being sold pursuant to a
Registration Statement and that does not directly or indirectly affect, impair,
limit or compromise the rights of other Holders of Registrable Securities may be
given by Holders of at least a majority in aggregate amount of the Registrable
Securities being sold by such Holders pursuant to such Registration Statement.
(d) Notices. All notices and other communications provided
for or permitted hereunder shall be made in writing by hand-delivery,
first-class mail (registered or certified, return receipt requested), or air
courier guaranteeing overnight delivery.
1. If to the Purchaser, as follows:
Merrill Lynch Global Allocation Fund, Inc.
800 Scudders Mill Road
Plainsboro, New Jersey 08536
Attention: Lisa A. O'Donnell
2. If to any other Holder, at the most current address of
such Holder set forth on the records of the Trustee or the
transfer agent of the Company, as applicable.
3. If to the Company, as follows:
Lexington Corporate Properties, Inc.
355 Lexington Avenue
New York, New York 10017
Attention: T. Wilson Eglin
4. If to the Partnership, in care of the Company at its
address indicated above.
All such notices and communications shall be deemed to
have been duly given: at the time delivered by hand, if personally delivered;
five business days after being deposited in the mail, postage prepaid, if
mailed; and on the next business day, if timely delivered to an air courier
guaranteeing overnight delivery.
-27-
<PAGE> 30
(e) Successors. This Agreement shall inure to the benefit
of and be binding upon the successors and assigns of each of the parties hereto,
and the Holders; provided, however, that this Agreement shall not inure to the
benefit of, or be binding upon, a successor or assign of a Holder unless and to
the extent such successor or assign holds Registrable Securities.
(f) Counterparts. This Agreement may be executed in
multiple counterparts and by the parties hereto in separate counterparts, each
of which when so executed shall be deemed to be an original and all of which
taken together shall constitute one and the same agreement.
(g) Headings. The headings in this Agreement are for
inconvenience of reference only and shall not limit or otherwise affect the
meaning hereof.
(h) Governing Law; Jurisdiction. THIS AGREEMENT SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK
AS APPLIED TO CONTRACTS MADE AND PERFORMED WHOLLY WITHIN THE STATE OF NEW YORK
WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW.
Each of the parties hereto irrevocably and
unconditionally: (i) submits itself and its property in any legal action or
proceeding relating to this Agreement or for recognition and enforcement of any
judgment in respect thereof, to the non-exclusive jurisdiction of the courts of
the State of New York and the courts of the United States of America for the
Southern District of New York, and appellate courts thereof, and consents and
agrees to such action or proceeding being brought in such courts; and (ii)
waives any objection that it may now or hereafter have to the venture of any
such action or proceeding was brought in any inconvenient court and agrees not
to plead or claim the same.
(i) Severability. In the event that any one or more of the
provisions herein, or the application thereof in any circumstance, is held
invalid, illegal or unenforceable, the validity, legality and enforceability of
any such provision in every other respect and of the remaining provisions
contained herein shall not be affected or impaired thereby.
(j) Securities Held by the Company or Its Affiliates.
Whenever the consent or approval of Holders of a specified percentage of
Registrable Securities is required hereunder, Registrable Securities held by the
Company or its affiliates (as such term is defined in Rule 405 under the
Securities Act) shall not be counted in determining whether such consent or
approval was given by the Holders of such required percentage.
-28-
<PAGE> 31
(k) Third Party Beneficiaries. Holders of Registrable
Securities are intended third party beneficiaries of the agreements made
hereunder between the Company and the Partnership on the one hand and the
Purchaser on the other hand this Agreement and shall have the right to enforce
this Agreement to the extent they deem such enforcement necessary or advisable
to protect their rights hereunder.
-29-
<PAGE> 32
(l) Entire Agreement. This Agreement, together with the
Purchase Agreement, the Indenture and the other agreements among the parties of
even date herewith or therewith, is intended by the parties as a final
expression of their agreement and intended to be a complete and exclusive
statement of the agreement and understanding of the parties hereto in respect of
the subject matter contained herein. There are no restrictions, promises,
warranties or undertakings, other than those set forth or referred to herein
with respect to the registration rights granted by the Company or the
Partnership with respect to the Registrable Securities. This Agreement
supersedes all prior agreements and understandings among the parties with
respect to such subject matter.
IN WITNESS WHEREOF, the parties have executed this
Agreement as of the date first written above.
LEXINGTON CORPORATE PROPERTIES, INC.
By:
-----------------------------------
Name:
-----------------------------------
Title:
-----------------------------------
LEPERCQ CORPORATE INCOME FUND L.P.
By: LEX GP-1, Inc., its General Partner
By:
-----------------------------------
Name:
-----------------------------------
Title:
-----------------------------------
MERRILL LYNCH GLOBAL ALLOCATION FUND,
INC.
By:
-----------------------------------
-30-
<PAGE> 33
Name:
-----------------------------------
Title:
-----------------------------------
-31-
<PAGE> 34
(l) Entire Agreement. This Agreement, together with the
Purchase Agreement, the Indenture and the other agreements among the parties of
even date herewith or therewith, is intended by the parties as a final
expression of their agreement and intended to be a complete and exclusive
statement of the agreement and understanding of the parties hereto in respect of
the subject matter contained herein. There are no restrictions, promises,
warranties or undertakings, other than those set forth or referred to herein
with respect to the registration rights granted by the Company or the
Partnership with respect to the Registrable Securities. This Agreement
supersedes all prior agreements and understandings among the parties with
respect to such subject matter.
IN WITNESS WHEREOF, the parties have executed this
Agreement as of the date first written above.
LEXINGTON CORPORATE PROPERTIES, INC.
By:
-----------------------------------
Name:
-----------------------------------
Title:
-----------------------------------
LEPERCQ CORPORATE INCOME FUND L.P.
By: LEX GP-1, Inc., its General Partner
By:
-----------------------------------
Name:
-----------------------------------
Title:
-----------------------------------
MERRILL LYNCH GLOBAL ALLOCATION FUND,
INC.
By:
-----------------------------------
-28-
<PAGE> 35
Name:
-----------------------------------
Title:
-----------------------------------
-29-
<PAGE> 1
Exhibit 5.3
- --------------------------------------------------------------------------------
LEPERCQ CORPORATE INCOME FUND L.P.,
as Issuer
LEXINGTON CORPORATE PROPERTIES, INC.
and
LEX GP-1, INC.,
as Guarantors
$25,000,000
8% Exchangeable Redeemable Secured Notes due 2004
INDENTURE
Dated as of March 17, 1997
THE CHASE MANHATTAN BANK,
as Trustee
- --------------------------------------------------------------------------------
<PAGE> 2
CROSS-REFERENCE TABLE
LEPERCQ CORPORATE INCOME FUND L.P.
<TABLE>
<CAPTION>
Trust Indenture
Act Section Indenture
----------- ---------
<S> <C>
Section 310(a)(1) 7.10
(a)(2) 7.10
(a)(3) Not Applicable
(a)(4) Not Applicable
(b) 7.8; 7.10; 12.2
(c) Not Applicable
Section 311(a) 7.11
(b) 7.11
(c) Not Applicable
Section 312(a) 2.5
(b) 12.3
(c) 12.3
Section 313(a) 7.6
(b)(1) Not Applicable
(b)(2) 7.6
(c) 7.6; 12.2
(d) 7.6
Section 314(a) 4.2; 12.2
(b) Not Applicable
(c)(1) 12.4
(c)(2) 12.4
(c)(3) Not Applicable
(d) 10.2
(e) 12.5
(f) 4.5
Section 315(a) 7.1(b)
(b) 7.5; 12.2
(c) 7.1(a)
(d) 7.1(c)
(e) 6.10
Section 316(a)(last sentence) 2.8
(a)(1)(A) 6.5
(a)(1)(B) 6.4
(a)(2) Not Applicable
(b) 6.6
Section 317(a)(1) 6.7
</TABLE>
<PAGE> 3
<TABLE>
<S> <C>
(a)(2) 6.8
(b) 2.4
Section 318(a) 12.1
</TABLE>
- ----------
Note: This Cross-Reference Table shall not, for any purpose, be
deemed to be a part of the Indenture.
<PAGE> 4
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE...................................... 1
SECTION 1.1 Definitions............................................. 1
SECTION 1.2 Other Definitions....................................... 6
SECTION 1.3 Incorporation by Reference of Trust
Indenture Act....................................................... 6
ARTICLE 2
THE SECURITIES.................................................................. 7
SECTION 2.1 Dating; Incorporation of Form in Indenture.............. 7
SECTION 2.2 Execution and Authentication; Amount.................... 8
SECTION 2.3 Registrar and Agents.................................... 9
SECTION 2.4 Paying Agent to Hold Money in Trust..................... 9
SECTION 2.5 Securityholder Lists.................................... 10
SECTION 2.6 Transfer and Replacement................................ 10
SECTION 2.7 Mutilated, Destroyed, Lost or Stolen
Securities.............................................. 12
SECTION 2.8 Outstanding Securities.................................. 12
SECTION 2.9 Temporary Securities.................................... 13
SECTION 2.10 Cancellation............................................ 13
SECTION 2.11 Defaulted Interest...................................... 13
SECTION 2.12 Persons Deemed Owners................................... 14
SECTION 2.13 CUSIP Number............................................ 14
SECTION 2.14 Interest................................................ 14
ARTICLE 3
REDEMPTION OF SECURITIES........................................................ 15
SECTION 3.1 Right of Redemption..................................... 15
SECTION 3.4 Selection by Trustee of Securities to be
Redeemed................................................ 15
SECTION 3.5 Notice of Redemption by the Issuer...................... 16
SECTION 3.6 Effect of Notice of Redemption.......................... 17
SECTION 3.7 Deposit of Redemption Price............................. 18
SECTION 3.8 Securities Redeemed in Part............................. 19
ARTICLE 4
COVENANTS....................................................................... 19
SECTION 4.1 Payment of the Securities............................... 19
SECTION 4.2 SEC Reports............................................. 20
</TABLE>
i
<PAGE> 5
<TABLE>
<S> <C>
SECTION 4.3 Waiver of Stay, Extension or Usury Laws................. 20
SECTION 4.4 Notice of Default....................................... 20
SECTION 4.5 Compliance Certificates................................. 21
SECTION 4.6 Limitation on Dividends and Other
Distributions........................................... 21
ARTICLE 5
SUCCESSOR CORPORATION........................................................... 22
SECTION 5.1 Merger, Consolidation or Sale of Assets by
the Issuer.............................................. 22
SECTION 5.2 Successor Corporation or Trust Substituted.............. 23
ARTICLE 6
DEFAULTS AND REMEDIES........................................................... 25
SECTION 6.1 Events of Default....................................... 25
SECTION 6.2 Acceleration............................................ 28
SECTION 6.3 Other Remedies.......................................... 29
SECTION 6.4 Waiver of Defaults and Events of Default................ 29
SECTION 6.5 Control by Majority..................................... 29
SECTION 6.6 Rights of Holders to Receive Payment.................... 29
SECTION 6.7 Limitation on Suits..................................... 30
SECTION 6.8 Collection Suit by Trustee.............................. 30
SECTION 6.9 Trustee May File Proofs of Claim........................ 31
SECTION 6.10 Trustee May Enforce Claims Without
Possession of Securities................................ 32
SECTION 6.11 Priorities.............................................. 32
SECTION 6.12 Undertaking for Costs................................... 33
ARTICLE 7
TRUSTEE......................................................................... 33
SECTION 7.1 Duties of Trustee....................................... 33
SECTION 7.2 Rights of Trustee....................................... 35
SECTION 7.3 Individual Rights of Trustee............................ 36
SECTION 7.4 Trustee's Disclaimer.................................... 36
SECTION 7.5 Notice of Defaults...................................... 36
SECTION 7.6 Reports by Trustee to Holders........................... 37
SECTION 7.7 Compensation and Indemnity.............................. 37
SECTION 7.8 Replacement of Trustee.................................. 38
SECTION 7.9 Successor Trustee by Merger, etc........................ 39
SECTION 7.10 Eligibility; Disqualification........................... 39
SECTION 7.11 Preferential Collection of Claims Against
Issuer.................................................. 40
</TABLE>
ii
<PAGE> 6
<TABLE>
<S> <C>
ARTICLE 8
SATISFACTION AND DISCHARGE OF INDENTURE......................................... 40
SECTION 8.1 Satisfaction, Discharge and Defeasance of
the Securities.......................................... 40
SECTION 8.2 Satisfaction and Discharge of Indenture................. 41
SECTION 8.3 Survival of Certain Obligations......................... 41
SECTION 8.4 Application of Trust Money.............................. 42
SECTION 8.5 Paying Agent to Repay Monies Held....................... 42
SECTION 8.6 Return of Unclaimed Monies.............................. 42
SECTION 8.7 Reinstatement........................................... 43
ARTICLE 9
AMENDMENTS AND WAIVERS.......................................................... 43
SECTION 9.1 Without Consent of Holders.............................. 43
SECTION 9.2 With Consent of Holders................................. 44
SECTION 9.3 Compliance with Trust Indenture Act..................... 45
SECTION 9.4 Revocation and Effect of Consents....................... 45
SECTION 9.5 Notation on or Replacement of Securities................ 46
SECTION 9.6 Trustee to Sign Amendments, etc......................... 46
ARTICLE 10
SECURITY........................................................................ 46
SECTION 10.1 Mortgage and Other Security Documents................... 46
SECTION 10.2 Recording, Etc.......................................... 47
SECTION 10.3 Suits to Protect the Collateral......................... 48
ARTICLE 11
SUBORDINATION OF SECURITIES TO SENIOR INDEBTEDNESS.............................. 48
SECTION 11.1 Securities Subordinated to Senior
Indebtedness; Except to the Extent of
Collateral Proceeds..................................... 48
SECTION 11.2 Liquidation; Dissolution; Bankruptcy.................... 49
SECTION 11.3 Default on Senior Indebtedness.......................... 50
SECTION 11.4 When Distribution Must Be Paid Over..................... 51
SECTION 11.5 Notice by the Issuer.................................... 51
SECTION 11.6 Subrogation............................................. 52
SECTION 11.7 Relative Rights......................................... 52
SECTION 11.8 Subordination May Not Be Impaired by the
Issuer.................................................. 52
SECTION 11.9 Distribution or Notice to Representatives............... 53
SECTION 11.10 Rights of Trustee and Holders........................... 53
SECTION 11.11 Holders Entitled to Assume Payments Not
Prohibited in Absence of Notice......................... 53
</TABLE>
iii
<PAGE> 7
<TABLE>
<S> <C>
SECTION 11.12 Application by Trustee of Monies Deposited
With It................................................. 53
SECTION 11.13 Officers' Certificate................................... 54
SECTION 11.14 Certain Payments........................................ 54
SECTION 11.15 Names of Representatives................................ 54
SECTION 11.16 Article 11 Not To Prevent Events of Default or Limit
Right To Accelerate or Exercise Remedies................ 54
SECTION 11.17 Reliance by Holders of Senior Indebtedness
on Subordination Provisions............................. 55
SECTION 11.18 No Fiduciary Duty Created to Holders of
Senior Indebtedness..................................... 55
ARTICLE 12
EXCHANGE OF SECURITIES.......................................................... 55
SECTION 12.1 Right of Exchange; Exchange Price....................... 55
SECTION 12.2 Issuance of Shares on .................................. 56
SECTION 12.3 No Adjustment for Interest or Dividends................. 57
SECTION 12.4 Adjustment of Exchange Price............................ 57
SECTION 12.5 Notice of Adjustment of Exchange Price.................. 60
SECTION 12.6 Notice of Certain Action................................ 61
SECTION 12.7 Taxes on Exchanges...................................... 62
SECTION 12.8 Fractional Shares....................................... 62
SECTION 12.9 Cancellation of Exchanged Securities.................... 62
SECTION 12.10 Provisions in Case of Consolidation, Merger
or Sale of Assets....................................... 63
SECTION 12.11 Disclaimer by Trustee and Exchange Agent of
Responsibility for Certain Matters...................... 63
SECTION 12.12 Covenant to Reserve Shares.............................. 64
SECTION 12.13 Refusal to Exchange Securities to Protect
Status.................................................. 64
ARTICLE 13
GUARANTEE....................................................................... 65
SECTION 13.1 Guarantee of the Obligations of the Issuer.............. 65
SECTION 13.2 Enforcement of Guarantee................................ 67
SECTION 13.3 Guarantee Subordinated to Senior
Indebtedness............................................ 67
SECTION 13.4 Subrogation............................................. 67
ARTICLE 14
MISCELLANEOUS................................................................... 68
SECTION 14.1 Trust Indenture Act Controls............................ 68
</TABLE>
iv
<PAGE> 8
<TABLE>
<S> <C>
SECTION 14.2 Notices................................................. 68
SECTION 14.3 Communications by Holders with Other
Holders................................................. 69
SECTION 14.4 Certificate and Opinion as to Conditions
Precedent............................................... 70
SECTION 14.5 Statements Required in Certificate and
Opinion................................................. 70
SECTION 14.6 Rules by Trustee and Agents............................. 71
SECTION 14.7 Record Date............................................. 71
SECTION 14.8 Legal Holidays.......................................... 71
SECTION 14.9 Governing Law........................................... 71
SECTION 14.10 No Adverse Interpretation of Other
Agreements.............................................. 71
SECTION 14.11 No Recourse against Others.............................. 71
SECTION 14.12 Successors.............................................. 72
SECTION 14.13 Multiple Counterparts................................... 72
SECTION 14.14 Table of Contents, Headings, etc........................ 72
SECTION 14.15 Severability............................................ 72
</TABLE>
Signatures
Exhibit A - Form of Mortgage
Exhibit B - Form of Security
Exhibit C - Form of Guarantee
v
<PAGE> 9
INDENTURE dated as of March 17, 1997 among LEPERCQ CORPORATE INCOME
FUND L.P., a Delaware limited partnership (the "Issuer"), LEXINGTON CORPORATE
PROPERTIES, INC., a Maryland corporation (the "REIT"), LEX GP-1, INC., a
Delaware corporation (the "General Partner"), and The Chase Manhattan Bank, a
New York banking corporation acting for the benefit and on behalf of the holders
of the Securities ("Trustee").
Each party agrees as follows for the benefit of the other party and
for the equal and ratable benefit of the Holders of the Issuer's 8% Exchangeable
Redeemable Secured Notes due 2004 (the "Securities"):
ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.1 Definitions.
"Affiliate" means any Person directly or indirectly controlling or
controlled by or under direct or indirect common control with the Issuer, the
General Partner or the REIT. For the purposes of this definition, "control"
(including, with correlative meanings, the terms "controlled by" and "under
common control with"), as used with respect to any Person, shall mean the
possession, directly or indirectly, of the power to direct or cause the
direction of the management or policies of such Person, whether through the
ownership of voting securities or by agreement or otherwise.
"Agent" means any Registrar, Paying Agent, Exchange Agent,
co-registrar or agent for service of notices and demands.
"Board of Directors" means the Board of Directors of the REIT, the
Board of Directors of the General Partner, or any committee of the Board of
Directors.
"Business Day" means a day that is not a Legal Holiday.
"Capital Stock" means any and all shares or other equivalents
(however designated) of common stock in the case of a
<PAGE> 10
corporation, or partnership interests (however designated) in the case of a
partnership.
"Charter" means the organizational documents of the Issuer, the
REIT, or the General Partner as the case may be, as amended or supplemented at
any time.
"Closing Price" means with respect to the shares of common stock of
the REIT on any day, (i) the last reported sales price regular way or, in case
no such reported sale takes place on such day, the average of the reported
closing bid and asked prices regular way, in either case on the New York Stock
Exchange, or (ii) if the shares of common stock are not listed or admitted to
trading on the New York Stock Exchange, the last reported sales price regular
way, or in case no such reported sale takes place on such day, the average of
the reported closing bid and asked prices regular way, on the principal national
securities exchange or national market system on which the shares of common
stock are listed or admitted to trading or quoted, or (iii) if the shares of
common stock are not listed or admitted to trading on any national securities
exchange or national market system, the average of the closing bid and asked
prices as furnished by any New York Stock Exchange member firm selected from
time to time by the REIT for that purpose.
"Code" means the Internal Revenue Code of 1986, as amended.
"Collateral" means, at any time, all of the property, interests and
rights then subject to the lien and security interest of the Mortgage and the
other Security Documents.
"Collateral Proceeds" means the proceeds of any sale or disposition
of any Collateral or of any insurance recovery with respect thereto.
"Corporate Trust Office" means the office of the Trustee at which at
any particular time its corporate trust business shall be principally
administered, which office at the date of execution of this Indenture is located
at 450 West 33rd Street - 15th Floor, New York, New York 10001.
"Credit Agreement" means that certain Amended and Restated Revolving
Credit Agreement, dated as of February 20,
- 2 -
<PAGE> 11
1997 by and among the REIT, the Issuer, the General Partner, certain other
related borrowers, the lenders party thereto and Fleet National Bank, as agent,
including any related notes, guarantees, collateral documents, instruments and
agreements executed in connection therewith, and in each case as amended,
modified, renewed, refunded, replaced or refinanced from time to time.
"Default" means any event which is, or after notice or passage of
time or both would be, an Event of Default.
"Dollar" or "$" means the lawful money of the United States of
America.
"General Partner" means the party named as such in the Preamble to
this Indenture until a successor replaces it pursuant to the Indenture and
thereafter means the successor.
"Guarantee" means the guarantee of the obligations of the Issuer by
the REIT and the General Partner contained in Article 13 of this Indenture.
"Holdback Period" means the period during which the Capital Stock of
the REIT issuable upon exchange of the Securities is prohibited from being sold
pursuant to Section 6(b) of the Registration Rights Agreement.
"Holder" or "Securityholder" means the person in whose name a
Security is registered on the Registrar's books. A Holder or Securityholder is
referred to from time to time in the Securities Documents as a Noteholder.
"Indebtedness" with respect to any Person means:
(1) any debt (i) for money borrowed, or (ii) evidenced by a bond,
note, debenture, or similar instrument (including purchase money obligations)
given in connection with the acquisition of any business, property or assets,
whether by purchase, merger, consolidation or otherwise, but shall not include
any account payable or other obligation created or assumed by a Person in the
ordinary course of business in connection with the obtaining of goods, materials
or services or obligations resulting from the endorsement of negotiable
instruments in the ordinary course of business, or (iii) which is
- 3 -
<PAGE> 12
a direct or indirect obligation which arises as a result of banker's acceptances
or bank letters of credit issued to secure obligations of such Person, or to
secure the payment of revenue bonds issued for the benefit of such Person,
whether contingent or otherwise;
(2) any debt of others described in the preceding clause (1) which
such Person has guaranteed or for which it is otherwise liable;
(3) the obligation of such Person as lessee under any lease of
property which is reflected on such Person's balance sheet as a capitalized
lease; and
(4) any deferral, amendment, renewal, extension, supplement or
refunding of any liability of the kind described in any of the preceding clauses
(1), (2) and (3), provided, however, that, in computing the "Indebtedness" of
any Person, there shall be excluded any particular indebtedness if, upon or
prior to the maturity thereof, there shall have been deposited with a depository
in trust money (or evidences of indebtedness if permitted by the instrument
creating such indebtedness) in the necessary amount to pay, redeem or satisfy
such indebtedness as it becomes due, and the amount so deposited shall not be
included in any computation of the assets of such Person.
"Indenture" means this Indenture as amended or supplemented from
time to time.
"Issuer" means the party named as such in the Preamble to this
Indenture until a successor replaces it pursuant to the Indenture and thereafter
means the successor.
"Lien" means any mortgage, lien, pledge, charge, security interest
or encumbrance of any nature whatsoever.
"Mortgage" means the Mortgage, Assignment of Leases and Rents,
Security Agreement and Fixture Filing dated as of March 17, 1997 between the
Issuer, as Mortgagor, and the Trustee, as mortgagee, covering the Real Estate
Collateral or real property constituting substitute Collateral or other real
property which has become Collateral pursuant to this Indenture, substantially
in the form attached hereto as Exhibit A and constituting a part
- 4 -
<PAGE> 13
hereof for all purposes, or such other form as may be required by applicable
state law or local custom.
"Obligations" means any principal, premium, interest (including
post-petition interest), penalties, fees, indemnifications, reimbursements,
damages and other liabilities payable under the documentation governing any
Indebtedness.
"Officer" means the Chairman of the Board, the Chief Executive
Officer, President, any Vice President, the Treasurer, the Secretary or the
Controller of (i) the General Partner or (ii) the REIT.
"Officers' Certificate" means a certificate signed by two Officers
or by an Officer and an Assistant Treasurer, Assistant Secretary or Assistant
Controller of the General
Partner or the REIT.
"Opinion of Counsel" means a written opinion from counsel who is not
an employee of the REIT, the Issuer, the General Partner or any Affiliate, and
who may be outside counsel to the Issuer, the General Partner, the REIT or the
Trustee.
"Person" means any individual, corporation, limited liability
company, partnership, joint venture, association, joint-stock company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
"principal" of a Security means the principal amount of the Security
plus, when appropriate, the premium, if any, on the Security.
"Real Estate Collateral" means Collateral covered by
the Mortgage.
"Redemption Date" when used with respect to any Security to be
redeemed, means the date fixed for such redemption pursuant to Section 3.1 of
this Indenture, provided that such date shall not occur during a Restricted
Period.
"Redemption Opinion" means an Opinion of Counsel from
nationally-recognized real estate investment trust counsel.
- 5 -
<PAGE> 14
"Redemption Price", when used with respect to any Securities to be
redeemed, means the price fixed for such redemption pursuant to this Indenture
as set forth in the form of Security annexed hereto as Exhibit B.
"Registration Rights Agreement" means that certain Registration
Rights Agreement dated as of March 17, 1997, among the Issuer, the REIT and the
initial Holder, as amended or supplemented from time to time.
"REIT" means the party named as such in the Preamble to this
Indenture until a successor replaces it pursuant to the Indenture and thereafter
means the successor.
"Representative" means the agent or representative, if any, for any
Senior Indebtedness.
"Restricted Period" means any period during which the Capital Stock
of the REIT issuable upon exchange of the Securities is prohibited from being
sold pursuant to Section 6 of the Registration Rights Agreement.
"SEC" means the Securities and Exchange Commission.
"Securities" means the securities in the form of Exhibit B hereto
that are issued under this Indenture, as amended or supplemented from time to
time, pursuant to this Indenture. The Securities are also referred to from time
to time in the Security Documents as the "Notes."
"Security Documents" means, collectively, the Mortgage, the
Assignment of Leases and Rents, any amendments or other supplements thereto, and
any other mortgages, deeds of trust, security agreements, financing statements,
pledge agreements or security instruments and documents executed by the Issuer
or the REIT to secure the obligations contemplated by this Indenture.
"Senior Indebtedness" shall mean any Obligations of the Issuer, the
General Partner or the REIT under the Credit Agreement (unless by the terms of
such Indebtedness it is expressly subordinated to the Securities).
"Subsidiary" means an entity the majority of whose voting stock is
owned by the Issuer, the General Partner or the
- 6 -
<PAGE> 15
REIT or a subsidiary of the Issuer, the General Partner or the REIT. Voting
stock is Capital Stock having voting power under ordinary circumstances to elect
directors or similar positions.
"TIA" means the Trust Indenture Act of 1939 (15 U.S. Code
Sections 77aaa-77bbbb) as amended by the Trust Indenture Reform Act of
1990 and as in effect on the date of this Indenture, except as provided in
Section 9.3.
"Trustee" means the party named as such in this Indenture until a
successor replaces it pursuant to this Indenture and thereafter means the
successor.
"Trust Officer", when used with respect to the Trustee, means any
officer within the Corporate Trust Office of the Trustee including any Vice
President, Managing Director, Assistant Vice President, Secretary, Assistant
Secretary or any other officer of the Trustee customarily performing functions
similar to those performed by any of the above designated officers and also,
with respect to a particular matter, any other officer to whom such matter is
referred because of such officer's knowledge and familiarity with the particular
subject.
"United States" means the United States of America.
SECTION 1.2 Other Definitions.
<TABLE>
<CAPTION>
Term Defined in Section
---- ------------------
<S> <C>
"Bankruptcy Law" 6.1
"Custodian" 6.1
"current market price" 12.4(6)
"Event of Default" 6.1
"Exchange Agent" 2.3
"exchange price" 12.1
"Issuer Request" 2.2
"Legal Holiday" 14.8
"Outstanding" 2.8
"Paying Agent" 2.3
"Payment Blockage Period" 11.3
"Registrar" 2.3
"Rule 13e-3 Transaction" 12.6
"U.S. Government Obligations" 8.1
</TABLE>
- 7 -
<PAGE> 16
SECTION 1.3 Incorporation by Reference of Trust Indenture Act.
Whenever this Indenture refers to a provision of the TIA, the
provision is incorporated by reference in and made a part of this Indenture. The
following TIA terms used in this Indenture have the following meanings:
"Commission" means the SEC.
"indenture securities" means the Securities.
"indenture security holder" means a Securityholder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means
the Trustee.
"obligor" on the indenture securities means the Issuer
or any other obligor on the indenture securities.
All other terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by SEC rules have the
meanings assigned to them therein.
SECTION 1.4 Rules of Construction.
Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning
assigned to it in accordance with United States generally accepted accounting
principles in effect as of the date of this Indenture.
(3) "or" is not exclusive; and
(4) words in the singular include the plural, and in
the plural include the singular.
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ARTICLE 2
THE SECURITIES
SECTION 2.1 Dating; Incorporation of Form in Indenture.
The Securities and the Trustee's certificate of authentication shall
be substantially in the form of Exhibit B which is incorporated in and made part
of this Indenture. The Securities may have notations, legends or endorsements
required by law, stock exchange rules, agreements to which the Issuer is
subject, or usage. Subject to the other provisions of this Section 2.1, the
Issuer shall approve the form of the Securities and any notation, legend or
endorsement on them. Each Security shall be dated the date of its
authentication.
The terms and provisions contained in the Securities shall
constitute, and are hereby expressly made, a part of this Indenture and to the
extent applicable, the Issuer, the General Partner, the REIT and the Trustee, by
their execution and delivery of this Indenture, expressly agree to such terms
and provisions and to be bound thereby.
SECTION 2.2 Execution and Authentication; Amount.
Two Officers shall sign the Securities for the Issuer by manual or
facsimile signature. The Issuer's seal shall be impressed, affixed, imprinted or
reproduced on the Securities and may be in facsimile form.
If an Officer whose signature is on a Security no longer holds that
office at the time the Trustee authenticates the Security, the Security shall
nevertheless be valid.
A Security shall not be valid until an authorized signatory of the
Trustee manually signs the certificate of authentication on the Security. Such
signature shall be conclusive evidence that the Security has been authenticated
under this Indenture.
The Trustee shall authenticate Securities for original issue in the
aggregate principal amount of up to $25,000,000 upon the execution of the
Indenture and receipt of a written order or orders, from time to time, of the
Issuer ("Issuer Request")
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signed by two Officers or by an Officer and an Assistant Treasurer of the
Issuer. The aggregate principal amount of Securities outstanding at any time may
not exceed that amount except as provided in Section 2.7. Each such Issuer
Request shall specify the amount of Securities to be authenticated and the date
on which the original issue of Securities is to be authenticated.
The Trustee may appoint an authenticating agent to authenticate
Securities. An authenticating agent may authenticate Securities whenever the
Trustee may do so. Each reference in this Indenture to authentication by the
Trustee includes authentication by such agent. An authenticating agent has the
same rights as an Agent to deal with the Issuer or an Affiliate.
The Securities shall be issuable only in registered form without
coupons and only in denominations of $1,000 principal amount and any integral
multiple thereof.
To evidence the Guarantee, the REIT and the General Partner shall
execute the Guarantee in the form of Exhibit C to be endorsed on each Security
authenticated by the Trustee which shall, without more, become effective on
March 31, 1997.
An Officer shall sign the Guarantee for the REIT and the General
Partner by manual or facsimile signature.
If an Officer whose signature is on a Guarantee no longer holds that
office at the time the Trustee authenticates a Security, the Guarantee shall
nevertheless be valid.
A Guarantee shall not be valid until an authorized signatory of the
Trustee manually signs the certificate of authentication on the Security on
which such Guarantee is endorsed.
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SECTION 2.3 Registrar and Agents.
The Issuer shall maintain in New York, New York an office or agency
where Securities may be presented for registration of transfer or for
replacement ("Registrar"), an office or agency where Securities may be presented
for payment ("Paying Agent"), an office or agency where Securities may be
presented for exchange ("Exchange Agent") and an office or agency where notices
and demands to or upon the Issuer in respect of the Securities and this
Indenture may be served. The Registrar shall keep a register of the Securities
and of their transfer or replacement. The Issuer may have one or more
co-registrars, one or more additional Paying Agents and one or more additional
Exchange Agents. The Issuer, the REIT, the General Partner or any Subsidiary may
act as Paying Agent or Exchange Agent. The term "Registrar" includes any
co-registrars, the term "Paying Agent" includes any additional paying agent and
the term "Exchange Agent" includes any additional exchange agent.
The Issuer may change any Paying Agent, Registrar or Exchange Agent
on 60 days' prior written notice to the Trustee. The Issuer shall notify the
Trustee of the name and address of any such Agent. If the Issuer fails to
maintain a Registrar, Paying Agent, Exchange Agent or agent for service of
notices and demands, or fails to give the foregoing notice, the Trustee shall
act as such.
The Issuer initially appoints the Trustee as Registrar, Paying
Agent, Exchange Agent and agent for service of notices and demands.
SECTION 2.4 Paying Agent to Hold Money in Trust.
On or prior to each due date of the principal of and interest on any
Securities, the Issuer shall deposit with each Paying Agent a sum sufficient to
pay such principal and interest so becoming due. The Issuer shall require each
Paying Agent other than the Trustee to agree in writing that it will hold in
trust for the benefit of Securityholders or the Trustee all money held by the
Paying Agent for the payment of principal of or interest on the Securities and
to notify the Trustee of any default by the Issuer (or any other obligor on the
Securities) in making any such payment. If the Issuer, the REIT, the General
Partner or a Subsidiary acts as Paying Agent, it shall on or
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before each due date of the principal of or interest on any Securities,
segregate the money and hold it as a separate trust fund. The Issuer at any time
may require a Paying Agent to pay all money held by it to the Trustee and the
Trustee may at any time during the continuance of any payment default, upon
written request to a Paying Agent, require such Paying Agent to forthwith pay to
the Trustee all sums so held in trust by such Paying Agent. Upon doing so, the
Paying Agent (other than the Issuer, the REIT, the General Partner or any
Subsidiary or Affiliate thereof) shall have no further liability for the money.
The final installment of principal on the Securities shall be
payable only upon surrender of such Securities at the office or agency of the
Trustee maintained in New York, New York. Payments of principal of and interest
on the Securities shall be made at the office or agency of the Trustee
maintained in New York, New York or, at the option of any Holder of at least
$500,000 aggregate principal amount of "Securities", by wire transfer of
immediately available funds for credit to such Holder's account or accounts as
such Holder may designate in writing at least 5 Business Days before the
scheduled payment date.
SECTION 2.5 Securityholder Lists.
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
Securityholders. If the Trustee is not the Registrar, the Registrar shall
furnish to the Trustee at least seven Business Days prior to each semiannual
interest payment date and at such other times as the Trustee may request in
writing a list in such form and as of such date as the Trustee may reasonably
require of the names and addresses of Securityholders. The Trustee may destroy
any such list upon receipt of a replacement list. The Paying Agent will solicit
from each Securityholder a certification of social security number or taxpayer
identification number in accordance with its customary practice and as required
by law, unless the Paying Agent is in possession of such certification. Each
Paying Agent is authorized to impose back-up withholding with respect to
payments to be made to Securityholders to the extent required by law.
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SECTION 2.6 Transfer and Replacement.
When a Security is presented to the Registrar or a co-registrar with
a request to register the transfer thereof, the Registrar or co-registrar shall
register the transfer as requested and when Securities are presented to the
Registrar or a co-registrar with a request to replace them with an equal
principal amount of Securities of other authorized denominations, the Registrar
shall make the replacement as requested provided that every Security presented
or surrendered for registration or transfer or replacement shall be duly
endorsed, or be accompanied by a written instrument of transfer in form
satisfactory to the Issuer and the Registrar duly executed by the Holder thereof
or his attorney-in-fact duly authorized in writing. To permit registrations of
transfers and replacement, the Issuer shall issue and the Trustee or any
authenticating agent shall authenticate Securities at the Registrar's or
co-registrar's request. No service charge shall be made for any registration of
transfer or replacement of Securities but the Issuer may require payment of a
sum sufficient to cover any tax or other governmental charge that may be imposed
in relation thereto, but this provision shall not apply to any replacement
pursuant to Section 2.9, 3.8, 9.5 or 12.2 not involving any transfer.
The Registrar shall not be required (i) to issue, register the
transfer of, or replace Securities during a period beginning at the opening of
business 15 days before the day of any selection of Securities for redemption
under Section 3.4 and ending at the close of business on the day of selection,
or (ii) to register the transfer or replacement of any Security so selected for
redemption in whole or in part, except the unredeemed portion of any Security
being redeemed in part.
The Issuer may instruct the Exchange Agent in writing to refuse to
permit the exchange of any Security (a) during any Restricted Period or (b) if
the Board of Directors shall in good faith determine such action necessary (i)
to protect the REIT's continuing qualification as a real estate investment trust
under Section 856(a) of the Code (ii) to comply with the Ownership Limit or
(iii) to avoid the REIT's classification as a pension-held real estate
investment trust under Code Section 856(h). A person shall be considered to own
shares of Common Stock if the person Beneficially Owns such Common Stock or
Constructively Owns such Common Stock. The terms "Ownership Limit,"
"Beneficially
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Owns" and "Constructively Owns" shall have the meanings set forth in Article
Ninth of the REIT's Charter. The Issuer shall advise the Exchange Agent in
writing promptly of any such determination by the Board of Directors with
respect to any Security, identifying such Security by Holder and other
appropriate method and shall instruct the Exchange Agent not to effect the
exchange of such Security. The Exchange Agent shall not be liable to the Issuer,
Holders of Securities or any other persons for transfers of Securities effected
prior to its receipt of such instructions from the Issuer and the Issuer shall
indemnify the Exchange Agent for all reasonable costs and expenses incurred by
it, in connection with refusing to exchange Securities as instructed by the
Issuer.
SECTION 2.7 Mutilated, Destroyed, Lost or Stolen Securities.
If a mutilated Security is surrendered to the Trustee or if the
Holder of a Security presents evidence to the satisfaction of the Issuer and the
Trustee that the Security has been lost, destroyed or wrongfully taken, the
Issuer shall issue and the Trustee shall authenticate a new Security in
replacement of and substitution for such Security if the requirements of the
Trustee and the Issuer are met. An indemnity bond may be required by the Issuer
or the Trustee that is sufficient in the judgment of the Issuer to protect the
Issuer and is sufficient in the judgment of the Trustee to protect the Trustee
or any Agent from any loss which it may suffer if a Security is replaced
pursuant to this Section 2.7. The Issuer and the Trustee may charge for
reasonable expenses in replacing a Security.
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SECTION 2.8 Outstanding Securities.
Securities "outstanding" means, as of the date of determination, all
Securities theretofore authenticated and delivered under this Indenture, except
(a) Securities theretofore canceled by the Trustee or delivered to the Trustee
for cancellation; and (b) Securities in exchange for or in lieu of which other
Securities have been authenticated and delivered pursuant to this Indenture,
other than any Securities in respect of which there shall have been presented to
the Trustee proof satisfactory to it that such Securities are held by a bona
fide purchaser in whose hands such Securities are valid obligations of the
Issuer; provided, that in determining whether the Securityholders of the
requisite principal amount of outstanding Securities are present at a meeting of
Securityholders for quorum purposes or have voted or taken or concurred in any
action under this Indenture, including the making of any request, demand,
authorization, direction, notice, consent or waiver hereunder, Securities owned
by the REIT, the General Partner, the Issuer or any other obligor upon the
Securities or any Affiliate of the Issuer, the General Partner, the REIT or such
other obligor shall be disregarded and deemed not outstanding, except that, in
determining whether the Trustee shall be protected in relying upon any such
determination as to the presence of a quorum or upon any such request, demand,
authorization, direction, notice, consent or waiver, only Securities which a
Trust Officer of the Trustee actually knows to be so owned shall be disregarded.
If a Security is replaced pursuant to Section 2.7, it ceases to be
outstanding until the Trustee receives proof satisfactory to it that the
replaced Security is held by a bona fide purchaser.
If the Paying Agent (other than the Issuer, the REIT, the General
Partner or any Subsidiary or Affiliate) holds on a Redemption Date or maturity
date money deposited with it by or on behalf of the Issuer sufficient to pay the
principal of and accrued interest on Securities payable on that date, then on
and after that date such Securities cease to be outstanding and interest on them
ceases to accrue.
A Security does not cease to be outstanding, other than as set forth
in this Section 2.8, because the Issuer, the REIT, the General Partner or an
Affiliate holds the Security.
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SECTION 2.9 Temporary Securities.
Until definitive Securities are ready for delivery, the Issuer may
prepare and the Trustee shall authenticate temporary Securities. Temporary
Securities shall be substantially in the form of definitive Securities but may
have non-material variations that the Issuer considers appropriate for temporary
Securities. Without unreasonable delay, the Issuer shall prepare and the Trustee
shall authenticate definitive Securities in replacement of temporary Securities
upon written order of the Issuer signed for the Issuer by two Officers. Until so
replaced, temporary Securities represent the same rights as definitive
Securities. Upon request of the Trustee, the Issuer shall provide a certificate
to the effect that the temporary securities meet the requirements of the second
sentence of this Section 2.9.
SECTION 2.10 Cancellation.
The Issuer at any time may deliver Securities to the Trustee for
cancellation. The Registrar, the Paying Agent and the Exchange Agent shall
forward to the Trustee any Securities surrendered to them for transfer,
replacement, payment or exchange. The Trustee shall cancel all Securities
surrendered for transfer, replacement, payment or exchange and destroy canceled
Securities and deliver a certificate of such destruction to the Issuer unless
the Issuer directs the Trustee in writing prior to such destruction to deliver
canceled Securities to the Issuer. Subject to Sections 2.7, 3.7 and the second
paragraph of Section 12.2, the Issuer may not issue Securities to replace
Securities that it has previously paid or delivered to the Trustee for
cancellation or that a Securityholder has exchanged pursuant to Article 12
hereof.
SECTION 2.11 Defaulted Interest.
If the Issuer defaults in a payment of interest on the Securities,
it shall pay the defaulted interest to the Persons who are Securityholders on a
subsequent special record date. After the deposit by the Issuer with the Trustee
of money sufficient to pay such defaulted interest, the Trustee shall fix the
special record date and payment date. Each such special record date shall be not
less than 10 days prior to such payment
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date. Each such payment date shall be not more than 60 days after the deposit by
the Issuer of money to pay the defaulted interest. At least 15 days before the
special record date, the Issuer shall mail to each Securityholder a notice that
states the special record date, the payment date, and the amount of defaulted
interest to be paid.
SECTION 2.12 Persons Deemed Owners.
Prior to registration of transfer, the Issuer, the Trustee and any
agent of the Issuer or the Trustee may treat the person in whose name such
Security is registered as the owner of such Security and neither the Issuer, the
Trustee nor any agent of the Issuer or the Trustee shall be affected by notice
to the contrary.
SECTION 2.13 CUSIP Number.
The Issuer may use a "CUSIP" number when issuing the Securities, and
if so, the Trustee may use the CUSIP number in notices of redemption or
replacement as a convenience to Securityholders; provided that any such notice
may state that no representation is made as to the correctness or accuracy of
the CUSIP number printed in the notice or on the Securities, and that reliance
may be placed only on the other identification numbers printed on the
Securities.
SECTION 2.14 Interest.
The Issuer promises to pay interest on the principal amount of the
Security at the rate per annum shown in the Security. The Issuer will pay
interest (i) semiannually on March 1 and September 1 of each year beginning
September 1, 1997 and (ii) upon the final payment of principal. Interest on the
Securities will accrue from the most recent date to which interest has been paid
or, if no interest has been paid, from March 17, 1997; provided that, if there
is no existing Default in the payment of interest, and if the Security is
authenticated between a record date referred to on the face of the Security and
the next succeeding interest payment date, interest shall accrue from such next
succeeding interest payment date. Interest will be computed on the basis of a
360-day year of twelve 30-day months.
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ARTICLE 3
REDEMPTION OF SECURITIES
SECTION 3.1 Right of Redemption.
The Securities may be redeemed at the election of the Issuer, as a
whole or from time to time in part, under the conditions and at the redemption
price (the "Redemption Price") specified in the form of Security annexed hereto
as Exhibit B, together with accrued and unpaid interest to the Redemption Date;
provided, however, that the Issuer may not redeem any Securities during a
Restricted Period.
SECTION 3.2 Applicability of Article.
Redemption of Securities at the election of the Company, as
permitted by any provision of this Indenture, shall be made in accordance with
such provision and this Article.
SECTION 3.3 Notices to Trustee.
If the Issuer elects to redeem the Securities pursuant to the
optional redemption provisions of Paragraph 5 of the Securities, it shall notify
the Trustee of the Redemption Date and the principal amount of Securities to be
redeemed. The notice shall be in writing and accompanied by an Officers'
Certificate stating that the redemption complies with the provisions of this
Indenture and that no Restricted Period is currently in effect nor will be in
effect during the period the Securities are to be redeemed. In case of any
partial redemption at the election of the Issuer, the Issuer shall, at least 45
days prior to the Redemption Date fixed by the Issuer (unless a shorter notice
shall be satisfactory to the Trustee), notify the Trustee by delivery to the
Trustee of an Officers' Certificate of such Redemption Date, the Redemption
Price and of the principal amount of Securities to be redeemed and in the event
of a redemption pursuant to Paragraph 5(b) of the Securities, a Redemption
Opinion that the redemption is necessary (i) to protect the REIT's continuing
qualification as a real estate investment trust under Section 856(a)(6) of the
Internal Revenue Code, (ii) to comply with the Ownership Limit, or
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(iii) to avoid the REIT's classification as a pension-held real estate
investment trust under Code Section 856(h).
SECTION 3.4 Selection by Trustee of Securities to be Redeemed.
If less than all the Securities are to be redeemed, the particular
Securities to be redeemed shall be selected not more than 45 nor less than 30
days prior to the Redemption Date by the Trustee, from the outstanding
Securities not previously called for redemption, pro-rata and which may provide
for the selection for redemption of portions (equal to $1,000 or any integral
multiple thereof) of the principal amount of Securities of a denomination larger
than $1,000.
If any Security selected for partial redemption is exchanged in part
before termination of the exchange right with respect to the portion of the
Security so selected, the exchanged portion of such Security shall be deemed (so
far as may be) to be the portion selected for redemption. For the purpose of
selecting Securities to be redeemed, the Trustee shall treat as outstanding for
the purpose of such selection any Securities surrendered for exchange during the
15 day period preceding the selection of the Securities.
The Trustee shall promptly notify the Issuer and the Registrar in
writing of the Securities selected for redemption and, in the case of any
Securities selected for partial redemption, the principal amount thereof to be
redeemed.
For all purposes of this Indenture, unless the context otherwise
requires, all provisions relating to the redemption of Securities shall relate,
in the case of any Securities redeemed or to be redeemed only in part, to the
portion of the principal amount of such Securities which has been or is to be
redeemed.
The Trustee's selection of Securities for redemption by any method
authorized by this Section 3.4 shall be conclusively deemed reasonable and the
Trustee shall incur no liability in connection with such selection.
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SECTION 3.5 Notice of Redemption by the Issuer.
At least 30 days but not more than 60 days before a Redemption Date,
the Issuer shall mail a notice of redemption by first-class mail to each Holder
of Securities to be redeemed, with a copy to the Trustee, but any failure to
give such notice by mail to a Holder or Holders of not more than 30% in
aggregate principal amount of Securities to be redeemed, or any defect thereon,
shall not effect the validity of the notice to any other Holder.
The notice shall identify the Securities (including CUSIP number, if any), to be
redeemed and shall state:
(1) the Redemption Date;
(2) the Redemption Price and the amount of accrued and
unpaid interest, if any, to the Redemption Date;
(3) the name and address of the Paying Agent and the
Exchange Agent;
(4) that if less than all of the outstanding Securities are to be
redeemed, the identification (and, in the case of partial
redemption, the principal amounts to be redeemed) of the
particular Securities to be redeemed;
(5) that on the Redemption Date the Redemption Price and accrued
and unpaid interest, if any, will become due and payable upon
each such Security to be redeemed and that interest thereon
will cease to accrue on and after said date;
(6) the exchange price, and that Securities called for redemption
may be exchanged at any time before the close of business on
the Business Day prior to the Redemption Date and if not
exchanged prior to the close of business on the Business Day
prior to Redemption Date, the right of exchange will be lost;
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(7) that Holders who elect to exchange Securities must
satisfy the requirements of Paragraph 7 of the
Securities;
(8) that Securities called for redemption must be surrendered to
the Paying Agent to collect the Redemption Price and accrued
and unpaid interest, if any; and
(9) that if any Security is being redeemed in part, upon surrender
of such Security, a new Security or Securities in principal
amount equal to the unredeemed portion thereof will be issued.
Notice of redemption of Securities to be redeemed at the election of
the Issuer shall be given by the Issuer or, at the Issuer's request, by the
Trustee in the name and the expense of the Issuer. If a CUSIP number is listed
in such notice or printed on the Security, the notice shall state that no
representation is made as to the correctness or accuracy of such CUSIP number.
SECTION 3.6 Effect of Notice of Redemption.
Subject to the limitation in Section 3.1, once notice of redemption
is mailed, Securities called for redemption become due and payable on the
Redemption Date and at the Redemption Price and interest on such Securities
shall cease to accrue on and after such Redemption Date, provided, however, that
any regular semiannual payment of interest becoming due on the Redemption Date
shall be payable to the holder of any such Securities as provided in Paragraph 2
of the Securities. Upon surrender to the Paying Agent, such Securities shall be
paid at the Redemption Price, plus accrued and unpaid interest to the Redemption
Date.
If any Security called for redemption shall not be so paid upon
surrender thereof for redemption, the principal shall, until paid, bear interest
from the Redemption Date at the rate borne by the Security.
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SECTION 3.7 Deposit of Redemption Price.
On or prior to any Redemption Date, the Issuer shall deposit with
the Paying Agent (or if the Issuer or a Subsidiary is the Paying Agent, shall
segregate and hold in trust or cause such Subsidiary to segregate and hold in
trust) an amount of money in immediately available funds by 10:00 a.m. New York
time on such Redemption Date sufficient to pay the Redemption Price of, and
(except if the Redemption Date shall be an interest payment date) accrued and
unpaid interest on all Securities to be redeemed on that date other than any
Securities called for redemption on that date which have been exchanged prior to
the date of such deposit.
If any Security called for redemption is exchanged, any money
deposited with any Paying Agent or so segregated and held in trust for the
redemption of such Security shall (subject to any right of the Holder of such
Security to receive interest as provided in Section 2.11) be paid to the Issuer
upon the Issuer's request or, if then held in trust by the Issuer or a
Subsidiary, shall be discharged from such trust.
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In connection with any redemption of Securities which the Issuer has
refused to exchange pursuant to Section 12.13, the Issuer shall use its
reasonable best efforts to arrange for the purchase and exchange of any
Securities by an agreement with one or more investment banking firms or other
purchasers to purchase such Securities by paying to the Trustee in trust for the
Securityholders, not later than one Business Day prior to the Redemption Date,
an amount not less than the applicable Redemption Price, together with interest
accrued to the date fixed for redemption, of such Securities. Notwithstanding
anything to the contrary contained in this Article 3, the obligation of the
Issuer to pay the Redemption Price of such Securities, together with interest
accrued to the date fixed for redemption, shall be deemed to be satisfied and
discharged to the extent such amount is so paid by such purchasers. If such an
agreement is made, any Securities not duly surrendered for exchange by the
Holders thereof may, at the option of the Issuer, be deemed, to the fullest
extent permitted by law, acquired by such purchasers from such Holders and
(notwithstanding anything to the contrary contained in Article 11) surrendered
by such purchasers for exchange, all as of immediately prior to the close of
business on the date fixed for redemption, subject to payment by the purchasers
as specified above. The Trustee shall hold and dispose of any such amount paid
to it in the same manner as it would moneys deposited with it by the Issuer for
the redemption of Securities. Without the Trustee's prior written consent, no
arrangement between the Issuer and such purchasers for the purchase and exchange
of any Securities shall increase or otherwise affect any of the powers, duties,
responsibilities or obligations of the Trustee as set forth in the Indenture,
and the Issuer agrees to indemnify the Trustee from, and hold it harmless
against, any loss, liability or expense arising out of or in connection with any
such arrangement for the purchase and exchange of any Securities between the
Issuer and such purchasers including the costs and expenses incurred by the
Trustee in the defense of any claim or liability arising out of or in connection
with the exercise or performance of any of its powers, duties, responsibilities
or obligations under this Indenture.
SECTION 3.8 Securities Redeemed in Part.
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Any Security which is to be redeemed only in part shall be
surrendered at an office or agency of the Issuer designated for that purpose
pursuant to Section 2.3 (with, if the Issuer or Trustee so requires, due
endorsement by, or a written instrument of transfer in form satisfactory to the
Issuer and the Trustee duly executed by, the Holder thereof or its attorney duly
authorized in writing), and the Issuer shall execute, and the Trustee shall
authenticate and deliver to the Holder of such Security without service charge,
a new Security or Securities, in an aggregate principal amount equal to and in
exchange for the unredeemed portion of the principal of the Security so
surrendered (in such authorized denominations as such Holder may request).
ARTICLE 4
COVENANTS
SECTION 4.1 Payment of the Securities.
The Issuer shall pay the principal of and interest on the Securities
on the dates and in the manner provided in the Securities and this Indenture. An
installment of principal or interest shall be considered paid on the date it is
due if the Trustee or Paying Agent (other than the Issuer, the REIT, the General
Partner or any Subsidiary or Affiliate) holds on that date money designated for
and sufficient to pay the installment. The Issuer shall pay interest on overdue
principal at the rate borne by the Securities; it shall pay interest, including
post-petition interest in the event of a proceeding under the Bankruptcy Laws,
on overdue installments of interest at the same rate to the extent lawful.
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SECTION 4.2 SEC Reports.
The Issuer, the REIT and the General Partner shall file with the
Trustee, promptly after filing with the SEC, copies of the annual reports and of
the information, documents and other reports (or copies of such portions of any
of the foregoing as the SEC may by rules and regulations prescribe) which each
of the Issuer, the General Partner and the REIT files with the SEC pursuant to
Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, provided
that neither the Issuer nor the General Partner shall be required to file such
reports with the Trustee unless and until it is otherwise obligated to file such
reports with the SEC. The Issuer, the General Partner and the REIT shall also
comply with the other provisions of TIA Section 314(a).
So long as the Securities remain outstanding, each of the Issuer,
the General Partner and the REIT shall cause its annual reports (containing
audited financial statements) to partners or stockholders, as the case may be,
and any other financial reports furnished by it to partners or stockholders, as
the case may be, to be mailed to the Holders at their addresses appearing in the
register of Securities maintained by the Registrar.
Delivery of such reports, information and documents to the Trustee
is for informational purposes only and the Trustee's receipt of such shall not
constitute constructive notice of any information contained therein or
determinable from information contained therein, including the Issuer's
compliance with any of its covenants hereunder (as to which the Trustee is
entitled to rely exclusively on Officers' Certificates).
SECTION 4.3 Waiver of Stay, Extension or Usury Laws.
Issuer expressly waives (to the extent that it may lawfully do so)
any stay or extension law or any usury law or other law that would prohibit or
forgive the Issuer from paying all or any portion of the principal of or
interest on the Securities as contemplated herein, wherever enacted, now or at
any time hereafter in force, or that may affect the covenants or the performance
of this Indenture.
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SECTION 4.4 Notice of Default.
The Issuer, the General Partner and the REIT will, so long as any of
the Securities are outstanding, deliver to the Trustee within 5 days of becoming
aware of any Default or Event of Default in the performance of any covenant,
agreement or condition in this Indenture, an Officers' Certificate specifying
such Default or Event of Default.
SECTION 4.5 Compliance Certificates.
The Issuer, the General Partner and the REIT will deliver to the
Trustee, within 90 days after the end of each fiscal year of the Issuer (which
as of the date hereof is December 31), written statements signed by the
principal executive officer, principal financial officer or principal accounting
officer of the Issuer, the General Partner and the REIT, stating, as to each
signer thereof, that:
(1) a review of the activities of the Issuer, the General Partner
and the REIT during such year and of performance under this Indenture, the
Mortgage and the other Security Documents has been made under his supervision;
(2) to the best of his knowledge, based on such review, the Issuer,
the General Partner and the REIT have kept, observed, performed and fulfilled in
all material respects each and every condition and covenant contained in this
Indenture, the Mortgage and the other Security Documents throughout such year,
or, if there has been a Default in the fulfillment of any such condition or
covenant, specifying each such Default known to him and the nature and status
thereof. Such compliance shall be determined without regard to periods of grace
or requirements of notice provided under this Indenture, the Mortgage or any
other Security Documents; and
(3) stating the exchange price (as described in Section 12.1 of this
Indenture) then in effect.
The Issuer, the General Partner and the REIT will give the Trustee
written notice of a change in their respective fiscal years, within a reasonable
time after such change is effected.
SECTION 4.6 Limitation on Dividends and Other Distributions.
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None of the Issuer, the General Partner or the REIT will declare or
pay any dividends or make any distribution to any holders of their respective
Capital Stock (other than dividends or, except in the case of an Event of
Default under clauses (1) or (2) of Section 6.1 hereof, distributions payable in
Capital Stock of the Issuer, the General Partner or the REIT, respectively), or
purchase, redeem or otherwise acquire or retire for value any of its Capital
Stock or permit any Subsidiary to purchase, redeem or otherwise acquire or
retire for value any of the Capital Stock of the Issuer, the General Partner or
the REIT if at the time of such action an Event of Default has occurred and is
continuing or would exist immediately after giving effect to such action.
Notwithstanding the foregoing, the provisions of this Section 4.6
will not prevent (i) the payment of any dividend or distribution necessary to
maintain the REIT's status as a real estate investment trust under the Code;
(ii) the payment of any dividend within 60 days after the date of declaration
when the payment would have complied with the foregoing provisions on the date
of declaration; or (iii) the retirement of any share of the Capital Stock of the
Issuer, the General Partner or the REIT by exchange for, or out of the proceeds
of the substantially concurrent sale (other than to a Subsidiary) of, other
shares of such Capital Stock.
ARTICLE 5
SUCCESSOR CORPORATION
SECTION 5.1 Merger, Consolidation or Sale of Assets by the Issuer
The Issuer shall not consolidate with or merge into, or transfer all
or substantially all of its assets to, another Person in any transaction in
which the Issuer, the General Partner or the REIT is not the continuing or
surviving entity unless (i) the resulting, surviving or transferee Person is a
corporation or trust which assumes by supplemental indenture all the obligations
of the Issuer, the General Partner and the REIT under the Securities and this
Indenture, and such corporation or trust expressly assumes in writing the
obligations of the Issuer
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under the Mortgage and the other Security Documents; (ii) such corporation or
trust is organized and existing under the laws of the United States, a State
thereof or the District of Columbia although it in turn may be owned by a
foreign entity; (iii) immediately after giving effect to such transaction no
Default or Event of Default shall have happened and be continuing, and the
Officers' Certificate referred to in the following clause reflects that such
Officers are not aware of any such Default or Event of Default that shall have
happened and be continuing; and (iv) the Issuer, the General Partner and the
REIT shall have delivered to the Trustee an Officers' Certificate and an Opinion
of Counsel, each stating that such consolidation, merger, sale or transfer and
such supplemental indenture comply with this Indenture, and thereafter all
obligations of the Issuer shall terminate.
If at any time there be any consolidation or merger or sale or
conveyance of property or assumption to which the covenants of this Section 5.1
are applicable, then in any such event the successor corporation will promptly
deliver to the Trustee:
(a) An Officers' Certificate stating that as of the time immediately
after the effective date of any such transaction the covenants of the Issuer,
the General Partner and the REIT contained in this Section 5.1 have been
complied with and the successor corporation is not in default under the
provisions of the Indenture; and
(b) An Opinion of Counsel stating that in his opinion such covenants
have been compiled with and that any instrument or instruments executed in the
performance of such covenants comply with the requirement thereof.
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SECTION 5.2 Successor Corporation or Trust Substituted.
Upon any consolidation or merger, or any transfer of all or
substantially all of the assets of the Issuer in accordance with Section 5.1,
the successor corporation or trust formed by such consolidation or into which
the Issuer is merged or to which such transfer is made shall succeed to, and be
substituted for, and may exercise every right and power of, the Issuer under
this Indenture, the Mortgage and the other Security Documents with the same
effect as if such successor corporation or trust has been named as the Issuer
herein.
SECTION 5.3 Merger, Consolidation or Sale of Assets by the REIT
The REIT shall not consolidate with or merge into, or transfer all
or substantially all of its assets to, another Person in any transaction in
which the REIT is not the continuing or surviving entity unless (i) the
resulting, surviving or transferee Person is a corporation or trust which
assumes by supplemental indenture all the obligations of the REIT under the
Securities and this Indenture; (ii) such corporation or trust is organized and
existing under the laws of the United States, a State thereof or the District of
Columbia although it in turn may be owned by a foreign entity; (iii) immediately
after giving effect to such transaction no Default or Event of Default shall
have happened and be continuing, and the Officers' Certificate referred to in
the following clause reflects that such Officers are not aware of any such
Default or Event of Default that shall have happened and be continuing; and (iv)
the REIT shall have delivered to the Trustee an Officers' Certificate and an
Opinion of Counsel, each stating that such consolidation, merger, sale or
transfer and such supplemental indenture comply with this Indenture, provided
that the REIT shall be permitted to reorganize as a business trust.
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SECTION 5.4 Merger, Consolidation or Sale of Assets by the General Partner
The General Partner shall not consolidate with or merge into, or
transfer all or substantially all of its assets to, another Person in any
transaction in which the General Partner is not the continuing or surviving
entity unless (i) the resulting, surviving or transferee Person is a corporation
or trust which assumes by supplemental indenture all the obligations of the
General Partner under the Securities and this Indenture; (ii) such corporation
or trust is organized and existing under the laws of the United States, a State
thereof or the District of Columbia although it in turn may be owned by a
foreign entity; (iii) immediately after giving effect to such transaction no
Default or Event of Default shall have happened and be continuing, and the
Officers' Certificate referred to in the following clause reflects that such
Officers are not aware of any such Default or Event of Default that shall have
happened and be continuing; and (iv) the General Partner shall have delivered to
the Trustee an Officers' Certificate and an Opinion of Counsel, each stating
that such consolidation, merger, sale or transfer and such supplemental
indenture comply with this Indenture, provided that the General Partner shall be
permitted to reorganize as a business trust.
SECTION 5.5 Evidence Furnished to Trustee.
The Trustee may receive an Opinion of Counsel as conclusive evidence
that any such merger, consolidation, sale or conveyance, and any assumption,
referred to in this Article 5 complies with the provisions of this Article 5.
SECTION 5.6 Successor Corporation or Trust to the REIT or the General Partner.
Upon any consolidation or merger, or any transfer of all or
substantially all of the assets of either the REIT or the General Partner in
accordance with Sections 5.3 or 5.4, respectively, the successor corporation or
trust formed by such consolidation or into which the REIT or General Partner, as
the case may be, is merged or to which such transfer is made shall succeed to,
and be substituted for, and may exercise every right and power of, the REIT or
General Partner, as the case may be, under this Indenture with the same effect
as if such successor
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corporation or trust has been named as the REIT or General
Partner, as the case may be, herein; the REIT or General Partner, as the case
may be, shall thereupon be relieved of any further obligation or liability
hereunder or upon the Securities; and the REIT or General Partner, as the case
may be, as the predecessor corporation may thereupon or at any time thereafter
be dissolved, wound up or liquidated.
ARTICLE 6
DEFAULTS AND REMEDIES
SECTION 6.1 Events of Default.
An "Event of Default" occurs if:
(1) the Issuer defaults in the payment of interest on any
Security when the same becomes due and payable or any other payment
obligation hereunder (other than payments of principal specified in
clause (3) of this Section 6.1), and the default continues for 5
Business Days;
(2) the Issuer defaults in the payment of any amount under the
Security Documents when the same becomes due and payable, and the
default continues for 5 Business Days thereafter and, singly or in
the aggregate with all other such defaults, can reasonably be
expected to have a material adverse effect on the condition
(financial or otherwise), business, liabilities (contingent or
otherwise), properties, net worth, solvency or results of operations
of the Issuer and its subsidiaries considered together as a single
enterprise (defaults in payments of other amounts under the Security
Documents to be treated under clause (4));
(3) the Issuer defaults in the payment of the principal of any
Security when the same becomes due and payable at maturity, upon
redemption or otherwise (including payment pursuant to Paragraph
5(a) of the Security) but no Event of Default shall have occurred if
payment pursuant to Paragraph 5(b) of the Security is prevented or
opposed by a Holder of the Security;
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(4) the Issuer, the General Partner or the REIT fails to
comply with any of its other covenants, agreements or conditions in
the Securities, this Indenture, the Mortgage or the other Security
Documents, and the default continues for the period and after the
notice specified in the last paragraph of this Section 6.1;
(5) there shall be a default under any bond, debenture, note
or other evidence of Indebtedness or under any mortgage, indenture
or other instrument under which there may be issued or by which
there may be secured or evidenced any Indebtedness of the Issuer,
the REIT, the General Partner or any Subsidiary, whether any such
Indebtedness now exists or shall hereafter be created, if (a) either
(i) such event of default results from the failure to pay any such
Indebtedness at maturity or (ii) as a result of such event of
default, (x) the maturity of such Indebtedness has been accelerated
prior to its stated maturity and (y) such acceleration shall not be
rescinded or annulled or the accelerated amount is paid within 10
days after notice to the Issuer, the General Partner or the REIT of
such acceleration, and (b) the principal amount of such
Indebtedness, together with the principal amount of any other such
Indebtedness in default for failure to pay principal or interest
thereon, or the maturity of which has been so accelerated,
aggregates $1,000,000 or more, except, with respect to any default
under any Indebtedness that is secured by any assets of the Issuer,
the General Partner or the REIT (and with respect to which the
holders thereof have no recourse to any other assets of the Issuer,
the General Partner or the REIT), the principal amount of any such
Indebtedness so in default aggregates $5,000,000 or more;
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(6) one or more final (non-interlocutory) judgments, orders or
decrees shall be entered against the Issuer, the General Partner or
the REIT involving in the aggregate a liability (in excess of
amounts covered by independent third-party insurance) as to any
single or related series of transactions, incidents or conditions,
of $5,000,000 or more, and the same shall remain unvacated and
unstayed pending appeal for a period of 30 days after the entry
thereof;
(7) the Issuer, the General Partner or the REIT pursuant to or
within the meaning of any Bankruptcy Law:
(A) commences a voluntary case or
proceeding,
(B) consents to the entry of an order for
relief against it in an involuntary case
or proceeding,
(C) consents to the appointment of a
Custodian (defined below) of it or for
all or substantially all of its
property, or
(D) makes a general assignment for the
benefit of its creditors;
(8) a court of competent jurisdiction enters an order or
decree under any Bankruptcy Law:
(A) for relief against the Issuer, the
General Partner or the REIT in an
involuntary case or proceeding,
(B) appointing a Custodian of the Issuer,
the General Partner or the REIT for all
or substantially all of its property, or
(C) ordering the liquidation of the Issuer, the
General Partner or the REIT, and, in each case,
the order or decree remains unstayed and in effect
for 90 days;
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(9) an involuntary petition is filed under any federal or
state bankruptcy or similar statute, whether now or hereafter
existing, against the Issuer, the General Partner or the REIT, or a
custodian, receiver, trustee, assignee for the benefit of creditors
(or other similar official) is appointed to take possession, custody
or control of the Collateral or any of it unless such petition or
appointment is set aside or withdrawn or ceases to be in effect
within 60 days from the date of such filing or appointment;
(10) the Mortgage or any other Security Document shall for any
reason be revoked or invalidated or otherwise cease to be in full
force and effect (other than in accordance with the terms thereof),
the Issuer shall contest in any manner the validity or
enforceability thereof or deny that it has any further liability or
obligation thereunder, or the Securities shall for any reason be
subordinated or shall not have the priority contemplated by this
Indenture, other than as provided by Article 11 or 13; or
(11) The Guarantee shall for any reason be revoked or
invalidated or otherwise cease to be in full force and effect, the
REIT or the General Partner shall contest in any manner the validity
or enforceability thereof or deny that it has any further liability
or obligation thereunder, or the REIT or the General Partner shall
fail to endorse any Guarantee to be attached to any Security.
The term "Bankruptcy Law" means Title 11 U.S. Code or any similar
Federal or State law for the relief of debtors. The term "Custodian" means any
receiver, trustee, liquidator or similar official under any Bankruptcy Law.
A default under clause (4) is not an Event of Default until the
Trustee notifies the Issuer, or the Holders of a majority in principal amount of
the Securities then outstanding notify the Issuer and the Trustee, of the
default and the Issuer, the General Partner or the REIT, as the case may be,
does not cure the default within 60 days after receipt of such notice. The
notice must specify the default, demand that it be remedied and state the notice
is a "Notice of Default." The Trustee shall
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give such notice to the Issuer only if directed to do so in writing by the
Holders of a majority in principal amount of the Securities then outstanding.
Such notice by the Trustee shall not be deemed to be a certification by the
Trustee as to whether an Event of Default has occurred.
SECTION 6.2 Acceleration.
If an Event of Default (other than an Event of Default specified in
Section 6.1(7), (8) or (11)) occurs and is continuing, the Trustee shall, at the
direction of a majority of the Holders and by notice to the Issuer, or the
Holders of a majority in principal amount of the Securities then outstanding by
notice to the Issuer and the Trustee, may declare to be due and payable
immediately the principal amount of the Securities plus accrued and unpaid
interest to the date of acceleration. Upon any such declaration, such amount
shall be due and payable immediately. If an Event of Default specified in
Section 6.1(7) or (8) occurs and is continuing, the principal amount of the
Securities then outstanding plus accrued and unpaid interest on the Securities
then outstanding to the date of the occurrence of such Event of Default shall
become and shall be immediately due and payable, without any declaration, notice
or other act on the part of the Trustee or the Holders. If an Event of Default
specified in Section 6.1(11) occurs and is continuing, interest on the
Securities will accrue from the date of default (or, if no interest has been
paid, from March 17, 1997) at the rate per annum set forth on such Security plus
0.5 percent and increasing by an additional 0.5 percent for each 90 days such
Event of Default has not been cured or waived up to a maximum of 2% in excess of
the interest rate stated on the Securities. Upon payment of any such amount all
of the Issuer's obligations under the Securities and this Indenture, other than
obligations under Section 7.7, shall terminate. The Holders of a majority in
principal amount of the outstanding Securities by notice to the Trustee may
rescind an acceleration and its consequences if (x) all existing Events of
Default, other than the non-payment of the principal of the Securities, which
have become due solely by such declaration of acceleration, have been cured or
waived, (y) to the extent the payment of such interest is lawful, interest on
overdue installments of interest and overdue principal which has become due
otherwise than by such declaration of acceleration, has been paid, and (z) the
rescission would not conflict with any judgment or decree of a court of
competent jurisdiction.
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SECTION 6.3 Other Remedies.
If an Event of Default occurs and is continuing, the Trustee may
pursue any available remedy by proceeding at law or in equity to collect the
payment of principal of or interest on the Securities or to enforce the
performance of any provision of the Securities or this Indenture.
The Trustee may maintain a proceeding even if it does not possess
any of the Securities or does not produce any of them in the proceeding. A delay
or omission by the Trustee or any Securityholder in exercising any right or
remedy accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of such right or remedy or acquiescence in the Event of
Default. No remedy is exclusive of any other remedy. All available remedies are
cumulative.
SECTION 6.4 Waiver of Defaults and Events of Default.
Subject to Section 9.2, the Holders of a majority in principal
amount of the Securities then outstanding, on behalf of the Holders of all of
the Securities, by written notice to the Trustee may waive a Default or Event of
Default and its consequences. When a Default or Event of Default is waived, it
is considered to be cured and ceases to exist.
SECTION 6.5 Control by Majority.
The Holders of a majority in principal amount of the Securities then
outstanding may direct the time, method and place of conducting any proceeding
for any remedy available to the Trustee, or exercising any trust or power
conferred on it. The Trustee, however, may refuse to follow any direction that
conflicts with law, this Indenture, the Mortgage or the other Security
Documents, that the Trustee determines may be unduly prejudicial to the rights
of other Securityholders or that may involve the Trustee in personal liability
or for which the Trustee does not have indemnification satisfactory to it
pursuant to Section 7.1(e); provided that the Trustee may take any other action
deemed proper by the Trustee which is not inconsistent with such direction.
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SECTION 6.6 Rights of Holders to Receive Payment.
Subject to Article 11, notwithstanding any other provision of this
Indenture, the right of any Holder to receive payment of principal of and
interest on the Security, on or after the respective due dates expressed in the
Security, or to bring suit for the enforcement of any such payment on or after
such respective dates, is absolute and unconditional and shall not be impaired
or affected without the consent of the Holder.
Notwithstanding any other provision of this Indenture, the right of
any Holder of a Security to exchange the Security or to bring suit for the
enforcement of such right shall not be impaired or affected without the consent
of the Holder.
SECTION 6.7 Limitation on Suits.
Subject to Section 6.6, a Securityholder who holds less than all of
the Securities then outstanding may not pursue any remedy with respect to this
Indenture or the Securities unless:
(1) the Holder gives to the Trustee written notice
stating that an Event of Default is continuing;
(2) the Holders of at least 25% in aggregate principal amount of the
Securities at the time outstanding make a written request to the
Trustee to pursue the remedy;
(3) such Holder or Holders offer to the Trustee security or
indemnity satisfactory to it against any loss, liability or expense
satisfactory to the Trustee;
(4) the Trustee does not comply with the request within 60 days
after receipt of the notice, the request and the offer of security
or indemnity; and
(5) the Holders of a majority in aggregate principal amount of the
Securities at the time outstanding do not give the Trustee a
direction inconsistent with the request during such 60-day period.
A Securityholder may not use this Indenture to prejudice the rights
of any other Securityholder or to obtain a preference or priority over any other
Securityholder. A
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Securityholder who holds all of the Securities then outstanding may pursue any
remedy with respect to this Indenture or the Securities following written notice
to the Trustee from such Securityholder.
SECTION 6.8 Collection Suit by Trustee.
If an Event of Default in payment of interest or principal specified
in Section 6.1(1) or (3) occurs and is continuing, the Trustee may recover
judgment in its own name and as trustee of an express trust against the Issuer,
the General Partner or the REIT for the whole amount of unpaid principal and
accrued interest remaining unpaid, together with interest on overdue principal
and to the extent that payment of such interest is lawful, interest on overdue
installments of interest, in each case at the rate borne by the Securities and
such further amount as shall be sufficient to cover the costs and expenses of
collection, including the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel, including reasonable fees and
expenses of counsel retained by the Trustee after or in anticipation of a
Default or Event of Default or a restructuring or workout relating thereto.
The Trustee, in its own name and as trustee of an express trust, may
institute a judicial proceeding for the collection of the sums so due and
unpaid, and may prosecute such proceeding to judgment of final decree, and may
enforce the same against the Issuer, the General Partner or the REIT and collect
the moneys adjudged or decreed to be payable in the manner provided by law out
of the property of the Issuer or any other obligor upon such Securities,
wherever situated.
If an Event of Default with respect to Securities occurs and is
continuing, the Trustee may in its discretion proceed to protect and enforce its
rights and the rights of the Holders of Securities by such appropriate judicial
proceedings as the Trustee shall deem most effectual to protect and enforce any
such rights, whether for the specific enforcement of any covenant or agreement
in this Indenture or in aid of the exercise of any power granted herein, or to
enforce any other property remedy.
SECTION 6.9 Trustee May File Proofs of Claim.
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In case of the pendency of any receivership, insolvency,
liquidation, bankruptcy, reorganization, arrangement, adjustment, composition or
other judicial proceeding relative to the Issuer, the General Partner or the
REIT upon the Securities or the property of the Issuer, the General Partner or
the REIT or their creditors, the Trustee (irrespective of whether the principal
of the Securities shall then be due and payable as therein expressed or by
declaration or otherwise and irrespective of whether the Trustee shall have made
any demand on the Issuer for the payment of overdue principal or interest) shall
be entitled and empowered, by intervention in such proceeding or otherwise:
(1) to file and prove a claim for the whole amount, or such lesser
amount as may be provided for in the Securities, of principal and
interest and additional amounts, if any, owing and unpaid in respect
of the Securities and to file such other papers or documents as may
be necessary or advisable in order to have the claims of the Trustee
(including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel)
and of the Holders allowed in such judicial proceeding, and
(2) to collect and receive any moneys or other property payable or
deliverable on any such claims and to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator (or
other similar official) in any such judicial proceeding is hereby authorized by
each Holder of Securities to make such payments to the Trustee, and in the event
that the Trustee shall consent to the making of such payments directly to the
Holders, to pay to the Trustee any amount due to it for the reasonable
compensation, expenses, disbursements and advances of the Trustee and any
predecessor Trustee, their agents and counsel, and any other amounts due the
Trustee or any predecessor Trustee under Section 7.7. To the extent that the
payment of any such compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel, and any other amounts due the Trustee under
Section 7.7 hereof out of the estate in any such proceeding, shall be denied for
any reason, payment for the same shall be secured by a Lien on, and shall be
paid out of, any and all distributions, dividends, money, securities and other
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properties which the Holders may be entitled to receive in such proceeding
whether in liquidation or under any plan of reorganization or arrangement or
otherwise.
Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Securityholder any
plan of reorganization, arrangement, adjustment or composition affecting the
Securities or the rights of any Holder thereof, or to authorize the Trustee to
vote in respect of the claim of any Securityholder in any such proceedings.
SECTION 6.10 Trustee May Enforce Claims Without Possession of Securities.
All rights of action and claims under this Indenture or any of the
Securities may be prosecuted and enforced by the Trustee without the possession
of any of the Securities or the production thereof in any proceeding relating
thereto, and any such proceeding instituted by the Trustee shall be brought in
its own name as trustee of an express trust, and any recovery of judgment shall,
after provision for the payment of the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, be for the
ratable benefit of the Holders of the Securities in respect of which such
judgment has been recovered.
SECTION 6.11 Priorities.
If the Trustee collects any money pursuant to this Article 6, it
shall pay out the money in the following order:
FIRST: to the Trustee for amounts due under Section
7.7;
SECOND: to holders of Senior Indebtedness to the
extent required by Article 11;
THIRD: to the Securityholders; and
FOURTH: to the Issuer.
The Trustee may fix a record date and payment date for any payment
to Securityholders pursuant to this Section 6.11.
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SECTION 6.12 Undertaking for Costs.
In any suit for the enforcement of any right or remedy under this
Indenture, the Mortgage or the other Security Documents or in any suit against
the Trustee for any action taken or omitted by it as Trustee, a court in its
discretion may require the filing by any party litigant in the suit of an
undertaking to pay the costs of the suit, and the court in its discretion may
assess reasonable costs, including reasonable attorney's fees, against any party
litigant in the suit, having due regard to the merits and good faith of the
claims or defenses made by the party litigant. This Section 6.12 does not apply
to a suit by the Trustee, a suit by a Holder pursuant to Section 6.6, or a suit
by Holders of more than 10% in principal amount of the Securities then
outstanding, or a suit by any holder of Senior Indebtedness.
ARTICLE 7
TRUSTEE
SECTION 7.1 Duties of Trustee.
(a) If an Event of Default has occurred and is continuing, the
Trustee shall exercise its rights and powers vested in it by this Indenture and
the Security Documents and use the same degree of care and skill in their
exercise as a prudent person would exercise or use under the circumstances in
the conduct of his own affairs; provided, however, that the Trustee shall have
no duties or responsibilities with respect to an Event of Default unless a Trust
Officer of the Trustee has actual knowledge of such Event of Default.
(b) Except during the continuance of an Event of Default:
(1) The Trustee need perform only those duties that are
specifically set forth in this Indenture and the Security
Documents and no others, and no implied covenants or
obligation shall be read into this Indenture or the Security
Documents against the Trustee.
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(2) In the absence of bad faith or gross negligence on its
part, the Trustee may conclusively rely, as to the truth of
the statements and the correctness of the opinions expressed
therein, upon certificates or opinions furnished to the
Trustee and conforming to the requirements of this Indenture
and the Security Documents. The Trustee, however, shall
examine the certificates and opinions which by any provision
of this Indenture or any Security Document are specifically
required to be delivered or furnished to the Trustee to
determine whether or not they substantially conform to the
requirements hereof or thereof.
(c) The Trustee may not be relieved from liability for its own
negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
(1) This paragraph does not limit the effect of paragraph (b)
of this Section 7.1.
(2) The Trustee shall not be liable for any error in judgment
made in good faith by a Trust Officer, unless it is proved
that the Trustee was negligent in ascertaining the pertinent
facts.
(3) The Trustee shall not be liable with respect to any action
it takes or omits to take in good faith in accordance with a
direction received by it pursuant to Section 6.5.
(4) No provision of this Indenture or the Security Documents
shall require the Trustee to expend or risk its own funds or
otherwise incur any financial liability in the performance of
any of its duties hereunder or in the exercise of any of its
rights or powers, if it shall have reasonable grounds for
believing that repayment of such funds or adequate indemnity
against such risk or liability is not reasonably assured to
it.
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(d) Every provision of this Indenture and the Security Documents
that in any way relates to the Trustee is subject to the provisions of
paragraphs (a), (b) and (c) of this Section 7.1.
(e) The Trustee may refuse to perform any duty or exercise any right
or power unless, subject to the provisions of the TIA, it receives indemnity
reasonably satisfactory to it against any loss, liability, expense or fee.
(f) The Trustee shall not be liable for interest on any money
received by it except as the Trustee may agree in writing with the Issuer. Money
held in trust by the Trustee need not be segregated from other funds except to
the extent required by law.
(g) Whenever the Trustee is required to provide any consents and/or
approval, or to perform any discretionary actions, under the Mortgage or any
other Security Documents, the Trustee shall not give any such consent or
approval or perform any such action except in accordance with written
instructions of the Holders of a majority in principal amount of Securities. The
Trustee shall have no duty to request any such instructions from the Holders.
The Trustee shall, however, promptly forward to the Holders a copy of any
written request that the Trustee receives whenever such request seeks consent,
approval or performance of any discretionary action under the Mortgage or any
other Security Documents.
SECTION 7.2 Rights of Trustee.
(1) The Trustee may conclusively rely on and shall be fully
protected in acting or refraining from acting upon any document believed in good
faith by it to be genuine and to have been signed or presented by the proper
person. The Trustee need not investigate any fact or matter stated in the
document.
(2) Before the Trustee acts or refrains from acting, it may require
an Officers' Certificate or an Opinion of Counsel, or both, which shall conform
to Sections 14.4 and 14.5. The Trustee shall not be liable for any action it
takes or omits to take in good faith in reliance on such Officers' Certificate
or Opinion of Counsel.
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(3) The Trustee may act through agents or attorneys and shall not be
responsible for the misconduct or negligence of such agents or attorneys
appointed with due care and shall not be responsible for their supervision.
(4) The Trustee shall not be liable for any action it takes, suffers
or omits to take in good faith which it believes to be authorized or within its
rights or powers.
(5) The Trustee may consult with counsel of its selection (at the
expense of the Issuer) and the advice of such counsel or any Opinion of Counsel
shall be full and complete authorization and protection in respect of any action
taken, suffered or omitted by the Trustee hereunder in good faith and reliance
thereon.
(6) The Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture or the Security Documents at the
request or direction of any of the Holders pursuant to this Indenture, unless
such Holders shall have offered to the Trustee reasonable security or indemnity
against the costs, expenses and liabilities which might be incurred by it in
compliance with such request or direction.
(7) The Trustee shall not be bound to make any investigation into
the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order, bond,
debenture, note, coupon or other paper or document, but the Trustee, in its
discretion, may make such further inquiry or investigation into such facts or
matters as it may see fit, and, if the Trustee shall determine to make such
further inquiry or investigation, it shall be entitled to examine the books,
records and premises of the Issuer, the General Partner or the REIT, personally
or by agent or attorney.
(8) Any request or direction of the Issuer mentioned herein shall be
sufficiently evidenced by an Issuer Request.
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SECTION 7.3 Individual Rights of Trustee.
The Trustee in its individual or any other capacity may become the
owner or pledgee of Securities and may otherwise deal with the Issuer or its
Affiliates with the same rights it would have if it were not Trustee. Any Agent
may do the same with like rights. The Trustee, however, is subject to Sections
7.10 and 7.11.
SECTION 7.4 Trustee's Disclaimer.
The Trustee makes no representation as to the validity or adequacy
of this Indenture or the Securities or the shares of common stock issuable upon
exchange of the Securities, or any of the Security Documents, it shall not be
accountable for the Issuer's use of the proceeds from the Securities, and it
shall not be responsible for any statement of the Issuer, the General Partner or
the REIT in the Indenture or any of the Security Documents or any statement in
the Securities other than its certificate of authentication, or in any document
used in the sale of the Securities other than any statement in writing provided
by the Trustee expressly for use in such document.
SECTION 7.5 Notice of Defaults.
If a Default or Event of Default occurs and is continuing and if it
is actually known to a Trust Officer of the Trustee, the Trustee shall mail to
each Securityholder, as their names and addresses shall appear on the security
register notice of the Default or Event of Default within 20 days after it
occurs. Except in the case of a default in payment of principal of or interest
on any Security, the Trustee may withhold the notice if and so long as a
committee of its Trust Officers in good faith determines that withholding the
notice is in the interests of Securityholders. Notwithstanding anything to the
contrary expressed in this Indenture, the Trustee shall not be deemed to have
knowledge of any Default or Event of Default hereunder unless and until a Trust
Officer shall have actual knowledge thereof, or shall have received written
notice thereof from the Issuer, the General Partner or the REIT at its principal
office in New York, New York. The Trustee shall not be deemed to have actual
knowledge of a Default or an Event of Default hereunder, except in the case of a
Default or an Event of Default under Sections 6.1(1) or 6.1(3), at such time as
the Trustee is
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also the Paying Agent, until a Trust Officer of the Trustee receives written
notice thereof from the Issuer or any Securityholder that such a Default or an
Event of Default has occurred.
SECTION 7.6 Reports by Trustee to Holders.
Within 60 days after each May 15 beginning with May 15, 1997, the
Trustee, if required by the provisions of TIA Section 313(a), shall mail to each
Securityholder a brief report dated as of such May 15 that complies with TIA
Section 313(a). The Trustee also shall comply with TIA Section 313(b) and
Section 313(c).
A copy of each report at the time of its mailing to Securityholders
shall be filed with the SEC and each securities exchange on which the Securities
are listed. The Issuer agrees promptly to notify the Trustee in writing whenever
the Securities become listed or delisted on or from any securities exchange.
SECTION 7.7 Compensation and Indemnity.
The Issuer shall pay to the Trustee from time to time such
compensation as the Issuer and the Trustee shall agree from time to time in
writing for its services (which compensation shall not be limited by any
provision of law in regard to the compensation of a trustee of an express
trust). The Issuer shall reimburse the Trustee upon request for all reasonable
disbursements, expenses and advances incurred or made by it. Such expenses may
include, but shall not be limited to, the reasonable compensation, disbursements
and expenses of the Trustee's agents and counsel.
The Issuer shall indemnify each of the Trustee (and its officers,
directors, employees and agents) and any predecessor Trustee for, and hold it
harmless against, any and all loss, damage, claims, liability or expense;
including taxes (other than taxes based upon, measured by or determined by the
income of the Trustee) incurred by it in connection with the acceptance or
administration of this trust and its duties hereunder, including the reasonable
costs and expenses of defending itself against any claim or liability in
connection with the Securities or the exercise or performance of any of its
powers or duties hereunder and under the Security Documents. The Trustee shall
notify the
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Issuer promptly of any claim asserted against the Trustee for which
it may seek indemnity.
The Issuer need not reimburse the Trustee for any expense or
indemnify it against any loss or liability incurred by it through the Trustee's
negligence, bad faith or willful misconduct.
To secure the Issuer's payment obligations in this Section , the
Trustee shall have a senior lien prior to the Securities, and to which the
Securities are hereby made subordinate, on all money or property held or
collected by the Trustee, subject to Section 6.11, except with respect to funds
held in trust for the benefit of holders of particular securities.
When the Trustee incurs expenses or renders services after an Event
of Default specified in Section 6.1 occurs, the expenses and the compensation
for the services are intended to constitute expenses of administration under any
applicable bankruptcy or comparable law.
The provisions of this Section 7.7 shall extend to any Exchange
Agent, Registrar or Paying Agent, and shall survive the termination of this
Indenture or the earlier resignation or removal of the Trustee, Exchange Agent,
Registrar or Paying Agent.
SECTION 7.8 Replacement of Trustee.
A resignation or removal of the Trustee and appointment of a
successor Trustee shall become effective only upon the successor Trustee's
acceptance of appointment as provided in this Section 7.8.
The Trustee may resign by so notifying the Issuer. The Holders of a
majority in principal amount of the Securities then outstanding may remove the
Trustee by so notifying the Trustee and may appoint a successor Trustee with the
Issuer's written consent. The Issuer may remove the Trustee if:
(1) the Trustee fails to comply with Section 7.10;
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(2) the Trustee is adjudged a bankrupt or an insolvent or an order
for relief is entered with respect to the Trustee under any
bankruptcy or comparable law;
(3) a receiver or other public officer takes charge of the Trustee
or its property; or
(4) the Trustee otherwise becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason, the Issuer shall promptly appoint a successor
Trustee.
If a successor Trustee does not take office within 30 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Issuer or the
Holders of a majority in principal amount of the Securities then outstanding may
petition any court of competent jurisdiction for the appointment of a successor
Trustee.
If the Trustee fails to comply with Section 7.10, any Securityholder
may petition any court of competent jurisdiction for the removal of the Trustee
and the appointment of a successor Trustee.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Issuer. Immediately after that,
the retiring Trustee shall, upon payment of its fees and expenses hereunder,
transfer all property held by it as Trustee to the successor Trustee, subject to
the senior lien provided for in Section 7.7, the resignation or removal of the
retiring Trustee shall become effective, and the successor Trustee shall have
all the rights, powers and duties of the Trustee under this Indenture and the
Security Documents. Notwithstanding the replacement of the Trustee pursuant to
this Section 7.8, the Issuer's obligations under Section 7.7 shall continue for
the benefit of the retiring Trustee with respect to reasonable expenses and
liabilities incurred by it and compensation earned by it prior to such
replacement or otherwise with respect to the Securities or the Indenture. A
successor Trustee shall mail notice of its succession to each Securityholder.
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SECTION 7.9 Successor Trustee by Merger, etc.
If the Trustee consolidates with, merges into, or transfers all or
substantially all of its corporate trust assets to, another corporation, the
successor corporation without any further act shall be the successor Trustee.
SECTION 7.10 Eligibility; Disqualification.
This Indenture shall always have a Trustee who satisfies the
requirements of TIA Section 310(a)(1). The Trustee shall have a combined capital
and surplus of at least $10,000,000 as set forth in its most recent published
annual report of condition. The Trustee shall comply with TIA Section 310(b).
SECTION 7.11 Preferential Collection of Claims Against Issuer.
The Trustee is subject to TIA Section 311(a), excluding any creditor
relationship listed in TIA Section 311(b). A Trustee who has resigned or been
removed shall be subject to TIA Section 311(a) to the extent indicated therein.
ARTICLE 8
SATISFACTION AND DISCHARGE OF INDENTURE
SECTION 8.1 Satisfaction, Discharge and Defeasance of the Securities.
The Issuer shall be deemed to have paid and discharged the entire
indebtedness on the Securities after the date of the deposit referred to in
paragraph (a) below, the provisions of this Indenture and the Security Documents
shall no longer be in effect in respect of the Securities, and the Trustee, at
the expense of the Issuer, shall execute proper instruments acknowledging
satisfaction and discharge of such indebtedness; provided that the following
conditions shall have been satisfied:
(a) the Issuer has deposited or caused to be deposited with
the Trustee irrevocably as trust funds in trust, specifically
pledged as security for, and dedicated solely to, the benefit of the
Holders of the Securities, with reference to this Section 8.1, (i)
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money or (ii) U.S. Government Obligations or (iii) a combination
thereof, sufficient, in the opinion of a nationally recognized firm
of independent public accountants expressed in a written
certification thereof delivered to the Trustee, to pay and discharge
the entire indebtedness on all the Securities for principal and
interest, if any, to March 17, 2004 as such principal or interest
becomes due and payable in accordance with the terms of this
Indenture and the Securities;
(b) the Issuer has paid or caused to be paid all other sums
payable hereunder by the Issuer in connection with the Securities,
including all reasonable fees and expenses of the Trustee; and
(c) the Issuer has delivered to the Trustee an Officers'
Certificate stating that all conditions precedent herein provided
for relating to the satisfaction and discharge of the entire
Indebtedness on the Securities and the discharge of this Indenture
and the Security Documents and the termination of the Issuer's, the
General Partner's and the REIT's obligations hereunder and
thereunder have been complied with.
"U.S. Government Obligations" means direct, non-callable obligations
of, or non-callable obligations guaranteed by, the United States of America for
the timely payment of which the full faith and credit of the United States of
America is pledged.
SECTION 8.2 Satisfaction and Discharge of Indenture and Security Documents.
In addition to its rights under Section 8.1, the Issuer may
terminate all of its obligations under this Indenture and the Security Documents
when:
(a) All of the Securities theretofore authenticated and
delivered (other than (A) Securities which have been destroyed, lost
or stolen and which have been replaced or paid as provided in
Section 2.7 hereof and (B) Securities for whose payment money has
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theretofore been deposited with the Trustee or the Paying Agent in
trust or segregated and held in trust by the Issuer and thereafter
repaid to the Issuer or discharged from such trust, as provided in
Section 2.4 and Section 8.6 hereof) have been delivered to the
Trustee for cancellation; and
(b) the Issuer has paid or caused to be paid all other sums
payable hereunder by the Issuer in connection with the outstanding
Securities, including all reasonable fees and expenses of Trustee.
SECTION 8.3 Survival of Certain Obligations.
Notwithstanding the satisfaction and discharge of this Indenture and
the Security Documents pursuant to Section 8.1, the obligations of the Issuer in
Paragraph 13 of the Securities and in Sections 2.3, 2.4, 2.5, 2.6, 2.7, 7.7,
8.5, 8.6, 8.7 and in Article 11 shall survive until the Securities are no longer
outstanding. Thereafter, or upon compliance with Section 8.2, only the
obligations of the Issuer in such Sections 7.7 and 8.6
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shall survive. Nothing contained in this Article 8 shall abrogate any of the
obligations or duties of the Trustee under this Indenture.
SECTION 8.4 Application of Trust Money.
(a) Subject to the provisions of Section 8.6, all money and U.S.
Government Obligations deposited with the Trustee for the Securities pursuant to
Section 8.1 or Section 8.2, and all money received by the Trustee in respect of
U.S. Government Obligations deposited with the Trustee for the Securities
pursuant to Section 8.1 or Section 8.2 shall be held in trust and reinvested by
the Trustee in (i) U.S. Government Obligations or (ii) beneficial interests in
one or more mutual funds which invest solely in U.S. Government Obligations and
which are rated in the highest applicable rating category by a
nationally-recognized statistical rating organization in accordance with the
Issuer's written instructions and applied by the Trustee in accordance with the
provisions of the Securities and this Indenture, to the payment, either directly
or through any Paying Agent (including the Issuer, the General Partner, the REIT
or any Subsidiary acting as Paying Agent) as the Trustee may determine, to the
Persons entitled thereto, of the principal and interest, if any, on the
Securities; but such money need not be segregated from other funds except to the
extent required by law. Money and U.S. Government Obligations so held in trust
are not subject to the subordination provisions of Article 11.
(b) The Trustee shall deliver or pay to the Issuer from time to time
upon the Issuer's written request any U.S. Government Obligations, or money held
by it as provided in Section 8.1 or Section 8.2 which, in the opinion of a
nationally recognized firm of independent public accountants expressed in a
written certification thereof delivered to the Trustee, are then in excess of
the amount thereof which then would have been required to be deposited for the
purpose for which such U.S. Government Obligations, or money, were deposited or
received.
SECTION 8.5 Paying Agent to Repay Monies Held.
Upon the satisfaction and discharge of this Indenture and the Security
Documents, all monies then held by any Paying Agent under the provisions of this
Indenture and the Security documents shall, upon written demand of the Issuer,
be repaid to it or paid to the Trustee, and thereupon such Paying Agent shall be
released from all further liability with respect to such monies.
SECTION 8.6 Return of Unclaimed Monies.
Any monies deposited with or paid to the Trustee or any Paying Agent
for the Securities, or then held by the Issuer in
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trust, for the payment of the principal of and interest, if any, on the
Securities and not applied but remaining unclaimed by the Holders for two years
after the date upon which the principal of and interest, if any, on the
Securities, as the case may be, shall have become due and payable, shall, unless
otherwise required by mandatory provisions of applicable escheat or abandoned or
unclaimed property law, be repaid to the Issuer by such Trustee or any Paying
Agent on written demand by the Issuer or (if then held by the Issuer or any
Affiliate) shall be discharged from such trust; and the Holders of the
Securities entitled to receive such payment shall thereafter look only to the
Issuer for the payment thereof; provided, however, that, before being required
to make any such repayment, such Trustee may, but shall not be obligated to
unless at the written request of the Issuer (at the expense of the Issuer),
cause to be published once in an authorized newspaper in the same city in which
the place of payment with respect to the Securities shall be located and in an
authorized newspaper in The City of New York, or mail to each such Holder, a
notice (in such form as may be deemed appropriate by such Trustee) that said
monies remain unclaimed and that, after a date named therein, any unclaimed
balance of said monies then remaining will be returned to the Issuer.
SECTION 8.7 Reinstatement.
If the Trustee or Paying Agent is unable to apply any money or U.S.
Government Obligations in accordance with Section 8.1 by reason of any legal
proceeding or by reason of any order or judgment of any court or governmental
authority enjoining, restraining or otherwise prohibiting such application, the
Issuer's , the General Partner's and the REIT's obligations under this
Indenture, the Securities and the Security Documents shall be revived and
reinstated as though no deposit had occurred pursuant to Section 8.1 until such
time as the Trustee or Paying Agent is permitted to apply all such money or U.S.
Government Obligations in accordance with Section 8.4; provided, however, that
if the Issuer has made any payment of interest on or principal of any Securities
because of the reinstatement of its obligations, the Issuer shall be subrogated
to the rights of the Holders of such Securities to receive such payment from the
money or U.S. Government Obligations held by the Trustee or Paying Agent.
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ARTICLE 9
AMENDMENTS AND WAIVERS
SECTION 9.1 Without Consent of Holders.
The Issuer, the General Partner, the REIT and the Trustee may amend or
supplement this Indenture (any indenture supplemental hereto to be in a form
satisfactory to the Trustee) or the Securities without consent of any
Securityholder:
(1) to comply with Sections 5.1, 5.3, 5.4 and 12.10;
(2) to provide for uncertificated Securities in addition to or in place
of certificated Securities, or
(3) to cure any ambiguity, defect or inconsistency, or to make any
other change that does not adversely affect the rights of any
Securityholder.
The Trustee shall receive upon request an Opinion of Counsel to its
satisfaction with respect to any amendment or supplement to this Indenture or
any of the Security Documents without consent of the Holders that all conditions
precedent have been satisfied. Copies of any such amendment or supplement shall
be mailed by the Trustee, at the Issuer's expense to each Holder who holds of
record $500,000 or more aggregate principal amount of Securities, as such
Holder's name and at such address as appears in the Securities' register.
SECTION 9.2 With Consent of Holders.
The Issuer, the General Partner, the REIT and the Trustee may amend
this Indenture, the Security Documents or the Securities with the written
consent of the Holders of at least 66 2/3% in principal amount of the Securities
then outstanding. The Holders of a majority in principal amount of the
Securities then outstanding may waive compliance in a particular instance by the
Issuer with any provision of this Indenture, the Security Documents or the
Securities. Without the consent of each Securityholder affected, however, an
amendment, supplement or waiver, including a waiver pursuant to Section 6.4, may
not:
(1) reduce the amount of Securities whose Holders must consent to an
amendment or waiver;
(2) reduce the rate of or extend the time for payment of interest on
any Security;
(3) reduce the principal or Redemption Price of or extend the fixed
maturity of any Security;
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(4) waive (except, unless theretofore cured) a default in the payment
of the principal of interest on or redemption amounts with respect to
any Security;
(5) make any Security payable in currency other than that stated in the
Security;
(6) make any change in Sections 6.4, 6.6 or 9.2;
(7) make any change that adversely affects the right to exchange any
Security; or
(8) make any change in Article 10 or Article 11 that adversely affects
the rights of any Securityholder.
To secure a consent of the Holders under this Section, it shall not be
necessary for the Holders to approve the particular form of any proposed
amendment or waiver; rather, it shall be sufficient if such consent approves the
substance thereof.
After an amendment or waiver under this Section becomes effective, the
Issuer shall mail to Securityholders a notice briefly describing such amendment
or waiver.
SECTION 9.3 Compliance with Trust Indenture Act.
Every amendment or supplement to this Indenture or the Securities shall
comply with the TIA as then in effect.
SECTION 9.4 Revocation and Effect of Consents.
Subject to this Indenture, each amendment, waiver or
instrument evidencing other action shall become effective in accordance with its
terms. Until an amendment, waiver or other action becomes effective, a consent
to it by a Holder is a continuing consent by the Holder even if notation of the
consent is not made on any Security. Any such Holder or subsequent Holder,
however, may revoke the consent as to his Security or portion of a Security, if
the Trustee receives the notice of revocation before the date the amendment,
waiver or other action becomes effective.
The Issuer may, but shall not be obligated to, fix a record date for
the purpose of determining the Holders entitled to consent to any amendment or
waiver. If a record date is fixed, then notwithstanding the provisions of the
immediately preceding paragraph, those persons who were Holders at such record
date (or their duly designated proxies) and only those persons, shall be
entitled to consent to such amendment or waiver or to revoke any consent
previously given, whether or not such persons continue to be Holders after such
record date. No
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consent shall be valid or effective for more than 90 days after such record date
unless consent from Holders of the principal amount of Securities required
hereunder for such amendment or waiver to be effective shall have also been
given and not revoked within such 90-day period.
After an amendment, waiver or other action becomes effective, pursuant
to Section 9.1 or Section 9.2, as the case may be, it shall bind every
Securityholder.
SECTION 9.5 Notation on or Replacement of Securities.
If an amendment or waiver changes the terms of a Security, the Trustee
may request the Holder of the Security to deliver it to the Trustee. The Trustee
may place an appropriate notation on the Security about the changed terms and
return it to the Holder. Alternatively, if the Issuer or the Trustee so
determine, the Issuer in replacement of for the Security shall issue and the
Trustee shall authenticate a new Security that reflects the changed terms.
SECTION 9.6 Trustee to Sign Amendments, etc.
The Trustee need not sign any amendment that adversely affects its
rights or interests, as determined by the Trustee in its sole discretion. In
signing or refusing to sign any amendment the Trustee shall be entitled to
receive and shall be fully protected in relying upon, an Opinion of Counsel
stating that such amendment is authorized or permitted by this Indenture. The
Issuer, the General Partner and the REIT may not sign an amendment until their
respective Boards of Directors approves it.
ARTICLE 10
SECURITY
SECTION 10.1 Mortgage and Other Security Documents.
In order to secure the due and punctual payment of the principal of and
accrued but unpaid interest on the Securities when and as the same shall be due
and payable, whether at maturity, by acceleration, call for redemption, or
otherwise, and interest on the overdue principal of the Securities and
performance of all other obligations of the Issuer to the Holders or the Trustee
under this Indenture and the Securities, according to the terms hereunder or
thereunder, the Issuer will grant its right, title and interest in and to the
Collateral to the Trustee pursuant to the Mortgage and the other Security
Documents and to the extent herein provided, no later than the date of the first
issuance of the Securities hereunder with respect to the Collateral. At the time
the Mortgage and the other Security
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Documents are executed and at all times thereafter, subject to the terms of the
Indenture and the Mortgage, the Issuer will have full right, power and lawful
authority to grant, bargain, sell, release, convey, hypothecate, assign,
mortgage, pledge, transfer and confirm, absolutely, the property constituting
the Collateral, in the manner and form done, or intended to be done, in the
Mortgage and the other Security Documents, free and clear of all Liens
whatsoever, except the Liens created by the Mortgage and the other Security
Documents and except to the extent otherwise provided therein or herein, and (a)
will forever warrant and defend the title to the same against the claims of all
Persons whatsoever, (b) will execute, acknowledge and deliver to the Trustee
such further assignments, transfer assurances or other instruments as the
Trustee may require or request, and (c) will do or cause to be done all such
acts and things as may be necessary or proper, or as may be required by the
Trustee, to assure and confirm to the Trustee the security interest in the
Collateral contemplated hereby, and by the Mortgage and the other Security
Documents, or any part thereof, as from time to time constituted, so as to
render the same available for the security and benefit of this Indenture and of
the Securities secured hereby, according to the intent and purposes herein
expressed. Subject to Section 7.7, the Mortgage and the other Security Documents
will create a direct and valid first priority Lien on the property constituting
the Collateral, as set forth therein. To the extent applicable, the Mortgage and
the other Security Documents will be governed by the Pennsylvania Uniform
Commercial Code as in effect from time to time.
SECTION 10.2 Recording, Etc.
The Issuer will cause, at its own expense, the Mortgage and the other
Security Documents and all amendments or supplements thereto to be registered,
recorded and filed or rerecorded, refiled and renewed in such manner and in such
place or places, if any, as may be required by law in order fully to preserve
and protect the security interests created under the Mortgage and the other
Security Documents in the Collateral and to effectuate and preserve the security
therein of the Holders and all rights of the Trustee.
If at any time the Securities are no longer secured pursuant to the
Mortgage and the other Security Documents, whether due to the payment in full or
defeasance of the Securities and release of the Collateral thereunder or
otherwise, and if all amounts due the Trustee hereunder and under the Mortgage
and the other Security Documents have been paid, the security interests
hereunder and under the Mortgage and the other Security Documents for the
benefit of the Securities shall be released by the Trustee.
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The release of any Collateral from the terms hereof and the Mortgage
and the other Security Documents will not be deemed to impair the security under
this Indenture in contravention of the provisions hereof if and to the extent
the Collateral is released pursuant to the Mortgage and the other Security
Documents. The Trustee and each of the Holders acknowledge that a release of
Collateral in accordance with the terms of the Mortgage and the other Security
Documents will not be deemed for any purpose to be an impairment of the security
under this Indenture. To the extent applicable, the Issuer shall cause TIA
Section 314(d) relating to the release of property or securities from the Lien
of the Mortgage and the other Security Documents to be complied with. Any
certificate or opinion required by TIA Section 314(d) may be made by an Officer
of the Issuer, except in cases in which TIA Section 314(d) requires that such
certificate or opinion be made by an independent Person.
SECTION 10.3 Suits to Protect the Collateral.
At the expense of the Issuer, the Trustee shall have power to institute
and to maintain such suits and proceedings as it may deem expedient to prevent
any impairment of the Collateral by any acts which may be unlawful or in
violation of this Indenture, the Mortgage or the other Security Documents, and
such suits and proceedings as the Trustee may deem expedient to preserve and
protect its interests and the interests of the Holders in the Collateral
(including power to institute and maintain suits or proceedings to restrain the
enforcement of or compliance with any legislative or other governmental
enactment, rule or order that may be unconstitutional or otherwise invalid if
the enforcement of, or compliance with, such enactment, rule or order would
impair the security hereunder or be prejudicial to the interest of the Holders
or the Trustee).
ARTICLE 11
SUBORDINATION OF SECURITIES TO SENIOR INDEBTEDNESS
SECTION 11.1 Securities Subordinated to Senior Indebtedness;
Except to the Extent of Collateral Proceeds.
The Issuer agrees, and each Holder by accepting a Security agrees,
that, except with respect to any and all Collateral securing the Obligations and
all Collateral Proceeds, the Indebtedness evidenced by the Securities, including
for all purposes of this Article 11, all repurchase and redemption obligations
with respect to the Securities, is expressly subordinated in right of payment,
to the extent and in the manner provided in this Article 11, to the prior
payment in full of all existing and future Senior Indebtedness in a form
accepted by the holder of the Senior Indebtedness and that the subordination is
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for the benefit of and enforceable by the holders of Senior Indebtedness, and
authorizes and directs the Trustee to take such action as may be necessary or
appropriate to acknowledge or effectuate the subordination as provided in this
Article 11 and appoints the Trustee as attorney-in-fact for any and all such
purposes.
Only Indebtedness of the Issuer, the General Partner and the REIT
which is Senior Indebtedness shall rank senior to the Securities in accordance
with the provisions set forth herein. This Article 11 shall remain in full force
and effect as long as any Senior Indebtedness is outstanding or any commitment
to advance Senior Indebtedness exists.
SECTION 11.2 Liquidation; Dissolution; Bankruptcy.
Upon any payment or distribution, whether of cash, securities or
other property, to creditors of the Issuer in a liquidation (total or partial),
reorganization or dissolution of the Issuer, whether voluntary or involuntary,
or in a bankruptcy, reorganization, insolvency, receivership, assignment for the
benefit of creditors, marshalling of assets or similar proceeding relating to
the Issuer or its property:
(a) holders of Senior Indebtedness shall be entitled to
receive payment in full, in cash or cash equivalents, of such
Senior Indebtedness before Holders shall be entitled to receive
any payment of principal of, or interest on, or any other
distribution with respect to, the Securities; and
(b) until the Senior Indebtedness is paid in full as provided
in clause (a) above, any distribution to which Holders would be
entitled but for this Article 11 shall be made to the holders of
Senior Indebtedness as their interests may appear;
except, in each case, that, notwithstanding any other provision of this
Indenture, Holders shall be entitled to receive all payments or distributions
with respect to the Collateral and any Collateral Proceeds and also may receive
shares of stock and debt securities that are expressly subordinated to Senior
Indebtedness to at least the same extent and pursuant to the same or more
stringent terms as are the Securities and have an average life to stated
maturity no shorter than the average life to stated maturity of the Securities.
Upon any distribution of assets of the Issuer referred to in this
Section 11.2, the Trustee and the Holders shall be entitled to conclusively rely
upon any order or decree of a court of competent jurisdiction in which such
bankruptcy, reorganization, insolvency, receivership, assignment for the
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benefit of creditors, marshalling of assets or similar proceedings are pending,
or a certificate of the liquidating trustee or agent or other such person making
any distribution to the Trustee or to the Holders, for the purpose of
ascertaining the persons entitled to participate in such distribution, the
holders of Senior Indebtedness, the amount thereof or payable thereon, the
amount or amounts paid or distributed thereon and all other facts pertinent
thereto or to this Section 11.2. The Trustee shall be entitled to conclusively
rely on the delivery to it of a written notice by a person representing himself
to be a holder of Senior Indebtedness to establish that such notice has been
given by a holder of Senior Indebtedness. In the event that the Trustee
determines, in good faith, that further evidence is required with respect to the
right of any person, as a holder of Senior Indebtedness, to participate in any
payment or distribution pursuant to this Section 11.2, the Trustee may request
such person to furnish evidence to the reasonable satisfaction of the Trustee as
to the amount of such Senior Indebtedness held by such person, as to the extent
to which such person is entitled to participate in such payment or distribution
and as to other facts pertinent to the rights of such person under this Section
11.2, and, if such evidence is not furnished, the Trustee may defer any payment
to such person (or to the Holder) pending judicial determination as to the right
of such person to receive such payment.
SECTION 11.3 Default on Senior Indebtedness.
No direct or indirect payment by or on behalf of the Issuer under the
Securities shall be made if (i) any Senior Indebtedness is not paid when due, or
(ii) any other default on Senior Indebtedness occurs and in the case of this
clause (ii) the maturity of such Senior Indebtedness is permitted to be
accelerated in accordance with its terms, unless, in either case, (x) the
default has been cured or waived and any such acceleration has been rescinded or
(y) such Senior Indebtedness has been paid in full in a form accepted by the
holder of the Senior Indebtedness; provided, however, that the Issuer may make
any such direct or indirect payment under the Securities without regard to the
foregoing (a) if, in the case of clause (ii), the Issuer and the Trustee receive
written notice approving such payment from the Representative of such Senior
Indebtedness or (b) if such payment is Collateral Proceeds or otherwise relates
to the Collateral. In addition, during the continuance of any other event of
default with respect to Senior Indebtedness pursuant to which the maturity of
such Senior Indebtedness may be accelerated immediately without further notice
(except such notice as may be required to effect such acceleration) or the
expiration of any applicable grace periods, upon the occurrence of (a) receipt
by the Trustee of written notice from the Representative with respect to, or the
holders of at least a majority in aggregate principal amount of, such Senior
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Indebtedness then outstanding, or (b) if such event of default results from the
acceleration of the Securities, the date of such acceleration, no direct or
indirect payment may be made by the Issuer upon or in respect of the Securities
(other than payments representing Collateral Proceeds or otherwise relating to
the Collateral) for a period (a "Payment Blockage Period") commencing on the
earlier of the date of receipt of such notice by the Trustee or the date of such
acceleration and ending 180 days thereafter (unless such Payment Blockage Period
shall be terminated by written notice to the Trustee from such Representative or
such holders). Not more than one Payment Blockage Period in the aggregate may be
commenced with respect to the Securities during any period of 360 consecutive
days, irrespective of the number of defaults with respect to Senior Indebtedness
during such period. In no event will a Payment Blockage Period extend beyond 179
days from the date such payment upon or in respect of the Securities was due;
and there must be 180 days in any 360-day period in which no Payment Blockage
Period is in effect as to the Issuer. For all purposes of this Section 11.3, no
default or event of default which existed or was continuing on the date of the
commencement of the Payment Blockage Period with respect to the Senior
Indebtedness initiating such Payment Blockage Period shall be made the basis for
the commencement of a subsequent Payment Blockage Period by the Representative
or requisite holders of such Senior Indebtedness whether or not within a period
of 360 consecutive days unless such default or event of default shall have been
cured or waived for a period of not less than 90 consecutive days.
SECTION 11.4 When Distribution Must Be Paid Over.
In the event that the Issuer shall make any payment to the Trustee or
the Holders pursuant to the Securities at a time when such payment is prohibited
by Section 11.2 or 11.3, such payment shall be held by the Trustee or the
Holders, as the case may be, in trust for the benefit of, and shall be paid
forthwith over and delivered to, the holders of Senior Indebtedness (pro rata as
to each of such holder on the basis of the respective amounts of Senior
Indebtedness held by them) or their Representatives, as their respective
interests may appear, for application to the payment of all Senior Indebtedness
remaining unpaid to the extent necessary to pay all Senior Indebtedness in full
in accordance with its terms, after giving effect to any concurrent payment or
distribution to or for the holders of Senior Indebtedness.
If a distribution is made to Holders that because of this Article 11
should not have been made to them, the Holders who receive the distribution
shall hold it in trust for holders of Senior Indebtedness and pay it over to
them as their interests may appear.
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SECTION 11.5 Notice by the Issuer.
The Issuer shall promptly notify the Trustee by an appropriate
Officers' Certificate of any facts known to the Issuer that would cause a
payment under the Securities of principal of or interest on the Securities to
violate this Article 11, but failure to give such notice shall not affect the
subordination of the Securities to the Senior Indebtedness provided in this
Article 11.
SECTION 11.6 Subrogation.
After all Senior Indebtedness is paid in full and all commitments to
advance Senior Indebtedness have been terminated, and until the Securities are
paid in full pursuant to the Securities and this Indenture or otherwise, Holders
shall be subrogated to the rights of holders of Senior Indebtedness to receive
distributions applicable to Senior Indebtedness to the extent that distributions
otherwise payable to Holders have been applied to payment of Senior
Indebtedness. A distribution made under this Article 11 to holders of Senior
Indebtedness which otherwise would have been made to Holders is not, as between
the Issuer and the Holders, a payment by the Issuer on Senior Indebtedness.
SECTION 11.7 Relative Rights.
This Article 11 defines the relative rights of holders of Senior
Indebtedness. Nothing in this Indenture (but subject to the provisions of
paragraph 5 of the Security) shall:
(a) impair, as between the Issuer and the Holders, the obligation
of the Issuer which is absolute and unconditional, to pay principal of
and interest on the Securities in accordance with their terms;
(b) affect the relative rights of Holders and creditors of the
Issuer other than such creditors as are holders of Senior Indebtedness;
(c) prevent the Issuer or any Holder from exercising its available
remedies upon a Default or Event of Default, subject to the rights of
holders of Senior Indebtedness to receive certain distributions
otherwise payable to Holders; or
(d) create or imply the existence of any commitment on the part of
the holders of Senior Indebtedness to extend credit to the Issuer other
than as set forth in the terms governing such Senior Indebtedness.
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SECTION 11.8 Subordination May Not Be Impaired by the Issuer.
No right of any present or future holder of Senior Indebtedness to
enforce the subordination of the Indebtedness evidenced by the Securities and
this Article 11 shall be impaired by any act or failure to act by the Issuer or
anyone in custody of its assets or property or by its failure to comply with
this Indenture.
SECTION 11.9 Distribution or Notice to Representatives.
Whenever a distribution is to be made or a notice given under the terms
of this Indenture to holders of Senior Indebtedness, the distribution may be
made and the notice given to their Representatives, if any.
SECTION 11.10 Rights of Trustee and Holders.
Notwithstanding Section 11.2 or 11.3, each Holder may continue to
receive payments of principal of or interest on the Securities unless the
Trustee shall have received, at least three Business Days prior to the date such
payments are due and payable, a written notice of the occurrence of an event
under Section 11.2 or 11.3 and that any payment under the Securities would
violate this Article 11. Only the Issuer or a Representative with respect to or
holders of at least a majority in principal amount of an issue of Senior
Indebtedness may give such notice. Subject to the notice period specified in the
first sentence of this Section 11.10, nothing contained in this Section 11.10
shall limit the right of any holder of Senior Indebtedness to recover payments
as contemplated by Section 11.4.
Each Holder in its individual or any other capacity may hold Senior
Indebtedness with the same rights it would have if it were not a Holder. Each
Holder shall be entitled to all the rights set forth in this Article 11 with
respect to Senior Indebtedness which may at any time be held by it, to the same
extent as any other holder of Senior Indebtedness.
SECTION 11.11 Holders Entitled to Assume Payments Not Prohibited
in Absence of Notice.
Notwithstanding any of the provisions of this Article 11 or any other
provision of this Indenture, unless the Trustee has received a written notice
pursuant to Section 11.10, the Trustee, Paying Agent and Holders shall not at
any time be charged with knowledge of the existence of any facts which would
prohibit the acceptance of any payment to such Holder, and in the absence of
such written notice, each Holder may accept all such payments without liability
or obligation to any holder of Senior Indebtedness.
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SECTION 11.12 Application by Trustee of Monies Deposited With
It.
Nothing contained in this Article 11 or elsewhere in this Indenture, or
in the Securities, shall (i) affect the obligation of the Issuer to make, or
prevent the Issuer from making, at any time except as specified in Section 11.2
or 11.3 to the extent provided therein, payments at any time pursuant to the
Securities, (ii) prevent the application by the Trustee or Paying Agent of any
monies or the proceeds of any U.S. Government Obligations received from the
Issuer and held by the Trustee or any Paying Agent in trust for the benefit of
the Holders as to which notice of redemption shall have been given, to the
payment of or on account of the principal of or interest on the Securities if,
at the time such notice was given, a payment by the Issuer under the Securities
would not have been prohibited by the foregoing provisions of this Article 11 or
(iii) prevent the application by the Trustee or any Paying Agent of any monies
or the proceeds of any U.S. Government Obligations deposited with it by the
Issuer under Article 8 hereof to the payment of or on account of the principal
of or interest on the Securities if, at the time of such deposit, a payment by
the Issuer under the Securities would not have been prohibited by the foregoing
provisions of this Article 11.
SECTION 11.13 Officers' Certificate.
If there occurs any event referred to in Section 11.2, the Issuer shall
promptly give a Officers' Certificate to the Trustee (on which certificate the
Trustee may conclusively rely) identifying all holders of Senior Indebtedness
and the principal amount of Senior Indebtedness then outstanding held by each
such holder and stating the reasons why such Officers' Certificate is being
delivered to the Trustee.
SECTION 11.14 Certain Payments.
Nothing in this Article 11 shall prevent or delay (i) the Issuer from
or in purchasing or redeeming any Securities in accordance with paragraph 5 of
the Securities or (ii) the receipt by the Holders of payments of principal of
and interest on the Securities as provided in Section 6.6 hereof.
SECTION 11.15 Names of Representatives.
The Issuer shall from time to time, upon request of the Trustee,
provide to the Trustee an Officers' Certificate setting forth the name and
address of each Representative of all outstanding Senior Indebtedness.
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SECTION 11.16 Article 11 Not To Prevent Events of Default or
Limit Right To Accelerate or Exercise Remedies.
The failure to make a payment pursuant to the Securities by reason of
any provision in this Article 11 shall not be construed as preventing the
occurrence of a Default or Event of Default. Nothing in this Article 11 shall
have any effect on the right of the Holders or the Trustee to accelerate the
maturity of the Securities or exercise any other remedy, including all remedies
available with respect to the Collateral.
SECTION 11.17 Reliance by Holders of Senior Indebtedness on
Subordination Provisions.
Each Holder by accepting a Security acknowledges and agrees that the
foregoing subordination provisions are, and are intended to be, an inducement
and a consideration to each holder of any Senior Indebtedness, whether such
Senior Indebtedness was created or acquired before or after the issuance of the
Securities, to acquire and continue to hold, or to continue to hold, such Senior
Indebtedness and such holder of Senior Indebtedness shall be deemed conclusively
to have relied on such subordination provisions in acquiring and continuing to
hold, or in continuing to hold, each Senior Indebtedness. No provision in any
supplemental indenture which modifies this Article 11 in any manner adverse to
the holders of Senior Indebtedness shall be effective against the holders of
Senior Indebtedness who have not consented thereto in accordance with the
provisions of the documents governing each Senior Indebtedness.
SECTION 11.18 No Fiduciary Duty Created to Holders of Senior
Indebtedness.
With respect to the holders of Senior Indebtedness, the Trustee and the
Holders undertake to perform or to observe only such of their respective
covenants and obligations as are specifically set forth in this Article 11, and
no implied covenants or obligations with respect to the holders of Senior
Indebtedness shall be read into this Indenture or the Security Documents against
the Trustee or the Holders. Neither the Trustee or any Holder shall be deemed to
owe any fiduciary duty to the holders of Senior Indebtedness.
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ARTICLE 12
EXCHANGE OF SECURITIES
SECTION 12.1 Right of Exchange; Exchange Price.
The Holder of any Security or Securities shall have the right, at his
option, at any time after March 17, 2000, other than during a Holdback Period
and before the close of business on the Business Day prior to the scheduled
maturity date of the Securities (except that, with respect to any Security or
portion of a Security which shall be called for redemption, such right shall
terminate at the close of business on the Business Day prior to the date fixed
for redemption of such Security or portion of a Security unless a Restricted
Period is then in effect or the Issuer shall default in payment due upon
redemption thereof), to exchange, subject to the terms and provisions of this
Article 12, the principal of any such Security or Securities or any portion
thereof which is $1,000 principal amount or an integral multiple thereof into
shares of common stock of the REIT, par value $0.01 per share ("Common Stock")
initially at the exchange price per share of $13.00; or, in case an adjustment
of such price has taken place pursuant to the provisions of Section 12.4, then
at the price as last adjusted (such price or adjusted price being referred to
herein as the "exchange price"), upon surrender of the Security or Securities,
the principal of which is so to be exchanged, accompanied by written notice of
exchange duly executed, to the Issuer at any time during usual business hours at
the office or agency maintained by it for such purpose, and, if so required by
the Exchange Agent or Registrar, accompanied by a written instrument or
instruments of transfer in form satisfactory to the Exchange Agent or Registrar
duly executed by the Holder or his duly authorized representative in writing.
For convenience, the exchange of any portion of the principal of any Security or
Securities for shares of Common Stock is hereinafter sometimes referred to as
the exchange of such Security or Securities.
SECTION 12.2 Issuance of Shares on Exchange.
As promptly as practicable after the surrender, as herein provided, of
any Security or Securities for exchange, the REIT shall deliver or cause to be
delivered at its said office or agency, to or upon the written order of the
Holder of the Security or Securities so surrendered, certificates representing
the number of fully paid and nonassessable shares of Common Stock into which
such Security or Securities may be exchanged in accordance with the provisions
of this Article 12. Such exchange shall be deemed to have been made as of the
close of business on the date that such Security or Securities shall have been
surrendered for exchange by delivery thereof with a written notice of exchange
duly executed, so that the rights of the
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Holder of such Security or Securities as a Securityholder shall cease at such
time and, subject to the following provisions of this paragraph, the person or
persons entitled to receive the shares of Common Stock upon exchange of such
Security or Securities shall be treated for all purposes as having become the
record holder or holders of such shares of Common Stock at such time and such
exchange shall be at the exchange price in effect at such time; provided,
however, that no such surrender on any date when the stock transfer books of the
REIT shall be closed shall be effective to constitute the person or persons
entitled to receive the shares of Common Stock upon such exchange as the record
holder or holders of such shares of Common Stock on such date, but such
surrender shall be effective to constitute the person or persons entitled to
receive such shares of Common Stock as the record holder or holders thereof for
all purposes at the close of business on the next succeeding day on which such
stock transfer books are open, regardless of whether a Restricted Period is
continuing; such exchange shall be at the exchange price in effect on the date
that such Security or Securities shall have been surrendered for exchange by
delivery thereof, as if the stock transfer books of the REIT had not been
closed. The REIT shall give or cause to be given to the Trustee written notice
whenever the stock transfer books of the REIT shall be closed.
Upon exchange of any Security which is exchanged in part only, the
Issuer shall execute and the Trustee shall authenticate and deliver to or on the
order of the Holder thereof, at the expense of the Issuer, a new Security or
Securities of authorized denominations in principal amount equal to the
unexchanged portion of such Security.
SECTION 12.3 No Adjustment for Interest or Dividends.
No payment or adjustment in respect of interest on the Securities or
dividends on the shares of Common Stock shall be made upon the exchange of any
Security or Securities; provided, however, that if a Security or any portion
thereof shall be exchanged subsequent to any regular record date and on or prior
to the next succeeding interest payment date, the interest falling due on such
interest payment date shall be payable on such interest payment date
notwithstanding such exchange, and such interest (whether or not punctually paid
or duly provided for) shall be paid to the person in whose name such Security is
registered at the close of business on such regular record date and Securities
surrendered for exchange during the period from the close of business on any
regular record date to the opening of business on the corresponding interest
payment date must be accompanied by payment of an amount equal to the interest
payable on such interest payment date. Notwithstanding the foregoing, interest
shall be paid through the exchange date on a Security surrendered for exchange
after the scheduled maturity date of the
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Securities if a Restricted Period is in effect on such scheduled maturity date
as provided in the Securities.
SECTION 12.4 Adjustment of Exchange Price.
(1) In case the REIT shall pay or make a dividend or other
distribution on any class of Capital Stock of the Issuer in shares of Common
Stock, the exchange price in effect at the opening of business on the day
following the date fixed for the determination of shareholders entitled to
receive such dividend or other distribution shall be reduced by multiplying such
exchange price by a fraction of which the numerator shall be the number of
shares of Common Stock outstanding at the close of business on the date fixed
for such determination and the denominator shall be the sum of such number of
shares and the total number of shares constituting such dividend or other
distribution, such reduction to become effective immediately after the opening
of business on the day following the date fixed for such determination.
(2) In case the REIT shall issue rights or warrants to all or
substantially all holders of its shares of Common Stock entitling them to
subscribe for or purchase shares of Common Stock (or securities convertible into
or exchangeable for shares of Common Stock) at a price per share less than the
current market price per share (determined as provided in paragraph (6) of this
Section) of the shares of Common Stock on the date fixed for the determination
of shareholders entitled to receive such rights or warrants, the exchange price
in effect at the opening of business on the day following the date fixed for
such determination shall be reduced by multiplying such exchange price by a
fraction of which the numerator shall be the number of shares of Common Stock
outstanding at the close of business on the date fixed for such determination
plus the number of shares of Common Stock which the aggregate of the
subscription or purchase price of the total number of shares of Common Stock so
offered for subscription or purchase would purchase at such current market price
and the denominator shall be the number of shares of Common Stock outstanding at
the close of business on the date fixed for such determination plus the number
of shares of Common Stock so offered for subscription or purchase, such
reduction to become effective immediately after the opening of business on the
day following the date fixed for such determination. In the event that all of
the shares of Common Stock subject to such rights or warrants have not been
issued when such rights or warrants expire, then the exchange price shall
promptly be readjusted to the exchange price which would then be in effect had
the adjustment upon the issuance of such rights or warrants been made on the
basis of the actual number of shares of Common Stock issued upon the exercise of
such rights or warrants. For the purposes of this paragraph (2), the number of
shares of Common Stock at any time outstanding shall not include
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shares held in the treasury of the Issuer but shall include shares issuable in
respect of scrip certificates issued in lieu of fractions of shares of Common
Stock. The REIT will not issue any rights or warrants in respect of shares of
Common Stock held in the treasury of the REIT.
(3) In case the outstanding shares of Common Stock shall be subdivided
into a greater number of shares, the exchange price in effect at the opening of
business on the day following the day upon which such subdivision becomes
effective shall be proportionately reduced, and, conversely, in case outstanding
shares of Common Stock shall each be combined into a smaller number of shares,
the exchange price in effect at the opening of business on the day following the
day upon which such combination becomes effective shall be proportionately
increased, such reduction or increase, as the case may be, to become effective
immediately after the opening of business on the day following the day upon
which such subdivision or combination becomes effective.
(4) In case the REIT shall, by dividend or otherwise, distribute to
all or substantially all holders of shares of Common Stock evidences of
indebtedness or assets (including securities, but excluding (i) any rights or
warrants referred to in paragraph (2) of this Section, (ii) any cash dividend or
distribution not prohibited by Section 4.6 hereof and (iii) any dividend or
distribution referred to in paragraph (1) of this Section), the exchange price
shall be adjusted so that the same shall equal the price determined by
multiplying the exchange price in effect immediately prior to the close of
business on the day fixed for the determination of shareholders entitled to
receive such distribution by a fraction of which the numerator shall be the
current market price per share (determined as provided in paragraph (6) of this
Section) of the shares of Common Stock on the date fixed for such determination
less the then fair market value as determined by the Board of Directors (whose
determination shall be conclusive and described in a resolution of the Board of
Directors filed with the Trustee) of the portion of the assets or evidences of
indebtedness so distributed allocable to one share of Common Stock and the
denominator shall be such current market price per share of the shares of Common
Stock, such adjustment to become effective immediately prior to the opening of
business on the day following the date fixed for the determination of
shareholders entitled to receive such distribution.
(5) In case the shares of Common Stock shall be changed into the same
or a different number of shares of any class or classes of stock, whether by
capital reorganization, reclassification, or otherwise (other than a subdivision
or combination of shares or a stock dividend described in paragraph (1) or
paragraph (3) of this Section, or a consolidation, merger
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or sale of assets described in Section 12.10), then and in each such event the
Holders shall have the right thereafter to exchange such Securities into the
kind and amount of shares of stock and other securities and property receivable
upon such reorganization, reclassification or other change, by holders of the
number of shares of Common Stock into which such Securities might have been
exchanged immediately prior to such reorganization, reclassification or change.
(6) For the purpose of any computation under paragraphs (2) and (4) of
this Section, the current market price per share of Common Stock on any date
shall be deemed to be the average of the Closing Prices for the 15 consecutive
Business Days ending on the second trading day before the date in question.
(7) No adjustment in the exchange price shall be required unless such
adjustment (plus any adjustments not previously made by reason of this paragraph
(7)) would require an increase or decrease of at least 1% in such price;
provided, however, that any adjustments which by reason of this paragraph (7)
are not required to be made shall be carried forward and taken into account in
any subsequent adjustment. All calculations under this paragraph (7) shall be
made to the nearest cent.
(8) The REIT may, but shall not be required to, make such reductions
in the exchange price, in addition to those required by paragraph (1), (2), (3),
(4) and (5) of this Section, as the Board of Directors considers to be advisable
in order to avoid or diminish any income tax to any holders of shares of Common
Stock resulting from any dividend or distribution of stock or issuance of rights
or warrants to purchase or subscribe for stock or from any event treated as such
for income tax purposes or for any other reasons. The Board of Directors shall
have the power to resolve any ambiguity or correct any error in the adjustments
made pursuant to this Section 12.4 and its actions in so doing shall be final
and conclusive.
(9) The adjustments provided for in this Section shall be made
successively whenever any event listed herein shall occur.
SECTION 12.5 Notice of Adjustment of Exchange Price.
Whenever the exchange price is adjusted as herein provided:
(a) the Issuer and the REIT shall compute the adjusted exchange
price in accordance with Section 12.4 and shall prepare an Officers'
Certificate setting forth the adjusted exchange price and showing in
reasonable detail the facts
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upon which such adjustment is based and the computation thereof, and
such certificate shall forthwith be filed at each office or agency
maintained for the purpose of exchange of Securities pursuant to
Section 2.3 and with the Trustee; and
(b) a notice stating that the exchange price has been adjusted and
setting forth the adjusted exchange price, and setting forth a brief
statement of the facts requiring such adjustment and the computation
thereof shall as soon as practicable be mailed by the Issuer and the
REIT to all Holders at their last addresses as they shall appear in the
Security Register. Neither the Trustee nor any Exchange Agent shall be
under any duty or responsibility with respect to any such certificate
except to exhibit the same to any Holder of Securities desiring
inspection thereof; and
(c) If the exchange price is adjusted and the Issuer and the REIT
fail to file an Officer's Certificate with the Trustee as provided by
Section 12.5(a) and the Trustee is acting as the Exchange Agent, the
Trustee shall be entitled to rely on the exchange price set forth in
the Officer's Certificate most recently received by the Trustee (or as
set forth in this Indenture if the exchange price shall not have been
adjusted).
SECTION 12.6 Notice of Certain Action.
(1) In case:
(a) the REIT shall authorize the granting to holders of its shares
of Common Stock of rights or warrants entitling them to subscribe for
or purchase any shares of Capital Stock of any class or of any other
rights; or
(b) of any reclassification of the shares of Common Stock, or of
any consolidation or merger to which the REIT is a party and for which
approval of any shareholders of the Issuer is required, or of the sale
or transfer of all or substantially all of the assets of the REIT; or
(c) of the voluntary or involuntary dissolution, liquidation or
winding up of the REIT;
then, in each case, the REIT shall cause to be filed at each office or agency
maintained for the purpose of exchange of Securities pursuant to Section 2.3 and
shall cause to be mailed to all Holders at their last addresses as they shall
appear in the Security Register, at least 20 days (or 10 days in any case
specified in clause (a) or (b) above) prior to the applicable record date
hereinafter specified, a notice stating (x) the date on which a record is to be
taken for the purpose of such
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dividend, distribution, rights or warrants, or, if a record is not to be taken,
the date as of which the holders of shares of Common Stock of record to be
entitled to such dividend, distribution, rights or warrants are to be
determined, or (y) the date on which such reclassification, consolidation,
merger, sale, transfer, dissolution, liquidation or winding up is expected to
become effective, and the date as of which it is expected that holders of shares
of Common Stock of record shall be entitled to exchange their shares of Common
Stock for securities, cash or other property deliverable upon such
reclassification, consolidation, merger, sale, transfer, dissolution,
liquidation or winding up. Such notice shall also state whether such transaction
will result in any adjustment in the exchange price applicable to the Securities
and, if so, shall state what the adjusted exchange price will be and when it
will become effective. Neither the failure to give the notice required by this
Section 12, nor any defect therein, to any particular Holder shall affect the
sufficiency of the notice or the legality or validity of any such dividend,
distribution, right, warrant, reclassification, consolidation, merger, sale,
transfer, liquidation, dissolution or winding-up, or the vote on any action
authorizing such with respect to the other holders.
(2) In case the REIT or any Affiliate of the REIT shall propose to
engage in a "Rule 13e-3 Transaction" as defined in the SEC's Rule 13e-3 under
the Securities Exchange Act of 1934, as amended, the REIT shall, no later than
the date on which any information with respect to such Rule 13e-3 Transaction is
first required to be given to the SEC or any other person pursuant to such Rule
13e-3, cause to be mailed to all Holders at their last addresses as they shall
appear in the Security Register, a copy of all information required to be given
to the SEC or such other person pursuant to such Rule 13e-3. The information
required to be given under this paragraph shall be in addition to and not in
lieu of any other information required to be given by the REIT pursuant to this
Section 12.6 or any other provision of the Securities or this Indenture.
SECTION 12.7 Taxes on Exchanges.
The REIT will pay any and all stamp or similar taxes that may be
payable in respect of the issuance or delivery of shares of Common Stock on
exchange of Securities pursuant hereto. The REIT shall not, however, be required
to pay any tax which may be payable in respect of any transfer involved in the
issuance and delivery of shares of Common Stock in a name other than that of the
Holder of the Security or Securities to be exchanged, and no such issuance or
delivery shall be made unless and until the person requesting such issuance has
paid to the REIT the amount of any such tax, or has established to the
satisfaction of the REIT that such tax has been paid.
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SECTION 12.8 Fractional Shares.
No fractional shares or scrip representing fractional shares shall be
issued upon the exchange of Securities. If any such exchange would otherwise
require the issuance of a fractional share an amount equal to such fraction
multiplied by the current market price per share of Common Stock (determined as
provided in paragraph (6) of Section 12.4) on the day of exchange shall be paid
to the Holder in cash by the REIT.
SECTION 12.9 Cancellation of Exchanged Securities.
All exchanged Securities shall be delivered to the Trustee to be
canceled by or at the direction of the Trustee as provided in Section 2.10.
SECTION 12.10 Provisions in Case of Consolidation, Merger or
Sale of Assets.
(1) In case of any consolidation of the REIT with, or merger of the
REIT into, any other Person, or in case of any merger of another Person into the
REIT (other than a consolidation or merger which does not result in any
reclassification, exchange or cancellation of outstanding shares of Common
Stock), or in case of any sale or transfer of all or substantially all of the
assets of the REIT, the Person formed by such consolidation or resulting from
such merger or which acquires such assets, as the case may be, shall execute and
deliver to the Trustee a supplemental indenture providing that the Holder of
each Security then outstanding shall have the right thereafter, during the
period such Security shall be exchangeable as specified in Section 12.1 to
exchange such Security only into the kind and amount of securities, cash and
other property receivable upon such consolidation, merger, sale or transfer by a
holder of the number of shares of Common Stock of the REIT into which such
Security might have been exchanged immediately prior to such consolidation,
merger, sale or transfer. Such supplemental indenture shall provide for
adjustments which, for events subsequent to the effective date of such
supplemental indenture, shall be as nearly equivalent as may be practicable to
the adjustments provided for in this Article. The above provisions of this
Section shall similarly apply to successive consolidations, mergers, sales or
transfers.
(2) The Trustee shall not be under any responsibility to determine the
correctness of any provisions contained in any such supplemental indenture
relating either to the kind or amount of shares of stock or securities or
property receivable by Holders upon the exchange of their Securities after any
such reclassification, change, consolidation, merger, sale or conveyance or to
any adjustment to be made with respect thereto.
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SECTION 12.11 Disclaimer by Trustee and Exchange Agent of
Responsibility for Certain Matters.
The Trustee (and each Exchange Agent other than the Issuer, the General
Partner, the REIT or any Subsidiary) shall not at any time be under any duty or
responsibility to any Holder to determine whether any facts exist which may
require any adjustment of the exchange price, how it should be made or
calculated or what it should be, or with respect to the nature or extent of any
such adjustment when made, or with respect to the method employed, or herein or
in any supplemental indenture provided to be employed, in making the same. The
Trustee (and each Exchange Agent other than the Issuer, the General Partner, the
REIT or any Subsidiary) shall not be accountable with respect to the validity,
value, kind or amount of any shares of Common Stock, or of any securities or
property, which may at any time be issued or delivered upon the exchange of any
Security; and it makes no representation with respect thereto. The Trustee (and
each Exchange Agent other than the Issuer, the General Partner, the REIT or any
Subsidiary) shall not be responsible for any failure of the REIT to issue,
transfer or deliver any shares of Common Stock or stock certificates or other
securities or property upon the surrender of any Security for the purpose of
exchange or, subject to Section 7.1, to comply with any of the covenants of the
REIT contained in this Article. The Trustee (and each Exchange Agent other than
the Issuer, the General Partner, the REIT or any Subsidiary) shall not at any
time be under any duty or responsibility to determine or inquire whether as a
result of any exchange of any Security any Person would then be deemed to own
shares of Common Stock in excess of the limits prescribed in the REIT's Charter.
SECTION 12.12 Covenant to Reserve Shares.
The REIT covenants that it will at all times reserve and keep
available, free from preemptive rights, out of its authorized shares of Common
Stock, solely for the purpose of issuance upon exchange of Securities as herein
provided, such number of shares of Common Stock as shall then be issuable upon
the exchange of all outstanding Securities. The REIT covenants that all shares
of Common Stock which shall be so issuable shall be, when issued, duly and
validly issued and fully paid and non-assessable. For purposes of this Section
12.12, the number of shares of Common Stock which shall be deliverable upon the
exchange of all outstanding Securities shall be computed as if at the time of
computation all outstanding Securities were held by a single holder.
SECTION 12.13 Refusal to Exchange Securities to Protect Status.
The REIT and the Exchange Agent may refuse to permit the exchange of
any Security if the Board of Directors shall in
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good faith determine such action necessary (i) to protect the REIT's continuing
qualification as a real estate investment trust under Section 856(a) of the Code
(ii) to comply with the Ownership Limit, or (iii) to avoid the REIT's
classification as a pension-held real estate investment trust under Code Section
856(h). A person shall be considered to own shares of Common Stock if the person
Beneficially Owns such Common Stock or Constructively Owns such Common Stock.
The terms "Ownership Limit," "Existing Holder Limit", "Beneficially Owns" and
"Constructively Owns" shall have the meanings set forth in the REIT's Charter.
Any attempted exchange of a Security or Securities by a Holder in violation of
the limits set forth in this paragraph (1) above shall be null and void ab
initio as to such Holder and such Holder shall not acquire any rights or
economic interest in the Common Stock issuable upon such exchange. The REIT
shall advise the Exchange Agent in writing promptly of any such determination by
the Board of Directors with respect to any Security, identifying such Security
by Holder and other appropriate method and shall instruct the Exchange Agent not
to effect the exchange of such Security. The Exchange Agent shall not be liable
to the REIT, Holders of Securities or any other persons for transfers of
Securities effected prior to its receipt of such instructions from the REIT and
the REIT shall indemnify the Exchange Agent (and its officers, directors,
employees and agents) for all costs and expenses incurred by it, in connection
with refusing to exchange Securities as instructed by the REIT.
ARTICLE 13
GUARANTEE
SECTION 13.1 Guarantee of the Obligations of the Issuer.
Commencing March 31, 1997, the REIT and the General Partner, jointly
and severally, hereby unconditionally guarantee, to the extent set forth in
Section 13.3, to the Holders and to the Trustee (i) the prompt payment of the
principal of, premium, if any, and interest on the Securities when the same
shall become due and payable (whether at stated maturity, by acceleration or
otherwise); (ii) to exchange such Securities by delivering duly authorized,
validly issued, fully paid and non-assessable shares of Common Stock in exchange
therefore according to the terms of such Security and this Indenture; and (iii)
the due and punctual performance by the Issuer of its obligations under the
Securities, the Security Documents and this Indenture, including, without
limitation, the prompt payment of all costs associated with the protection of
the Collateral or the enforcement of the Issuer's obligations and the Trustee's
rights under the Securities, the Security Documents and the Indenture. Each of
the REIT and the General Partner agrees that this Section 13 is a
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guarantee of payment and performance and not of collection, and that its
obligations under this Section 13 shall be, to the extent set forth in Section
13.3, primary, absolute and unconditional, irrespective of, and unaffected by
(a) the genuineness, validity, regularity, enforceability or any
future amendment or modification of this Indenture, the Securities or any
instrument relating thereto or any other agreement, document or instrument to
which the Issuer, the General Partner or the REIT is or are or may become a
party;
(b) the absence of any action to enforce the Securities, this
Indenture or the Security Documents or the waiver or consent by the Holders with
respect to any of the provisions thereof;
(c) the obtaining of any judgment against the Issuer or any action to
enforce this Indenture, the Securities, the Security Documents, or any
agreement, document or instrument relating thereto;
(d) the existence, value or condition of, or failure to perfect any
lien against, any security for the Securities or any action, or the absence of
any action, by the Trustee or the Holders in respect thereof (including, without
limitation, the release of any such security); or
(e) any other action or circumstances which might otherwise constitute
a legal or equitable discharge or defense of a surety or guarantor, it being
agreed by the REIT and the General Partner that this guarantee shall remain in
full force and effect and be binding in accordance with and to the extent of its
terms upon the REIT and the General Partner until the payment and performance,
in full, of the Securities.
The REIT and the General Partner shall be regarded, and shall be in the
same position, as the principal debtor with respect to the Securities. Each of
the REIT and the General Partner hereby waives diligence, presentment, demand of
payment, filing of claims with a court in the event of merger, dissolution,
liquidation or bankruptcy of the Issuer, protest or notice with respect to any
such Security, this Indenture, or the indebtedness evidenced thereby and all
demands whatsoever. Each of the REIT and the General Partner hereby waives all
rights existing now or in the future under any statute, or at common law, or at
law or in equity, or otherwise, to compel the Trustee or any Holder to proceed
in respect of the Securities against the Issuer or any other party or against
any security for the payment and performance of the Securities before proceeding
against, or as a condition to proceeding against, the REIT or the General
Partner. Each of the REIT and the General Partner agrees that any notice or
directive given at any time to the Trustee or any
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Holder which is inconsistent with the waiver in the immediately preceding
sentence shall be null and void and may be ignored by the Trustee, and, in
addition, may not be pleaded or introduced as evidence in any litigation
relating to this Indenture for the reason that such pleading or introduction
would be at variance with the written terms of this Indenture, unless the
Trustee has specifically agreed otherwise in writing. It is agreed among the
REIT, the General Partner and the Holders that the foregoing waivers are of the
essence of the transaction contemplated by the Securities, this Indenture or any
instrument relating thereto and that, but for this guarantee and such waivers,
the Holders would decline to purchase the Securities.
SECTION 13.2 Enforcement of Guarantee.
In no event shall the Holders or the Trustee have any obligation
(although it is entitled, at its option) to proceed against the Issuer or any
other person or any real or personal property before seeking satisfaction from
the REIT or the General Partner, and the Trustee may proceed, prior or
subsequent to, or simultaneously with, the enforcement of the Holders' or
Trustee's rights hereunder, to exercise any right or remedy which it may have
against any property, real or personal, as a result of any lien it may have as
security for all or any portion of the Securities.
SECTION 13.3 Guarantee Subordinated to Senior Indebtedness.
Each of the Guarantors agrees, and each Holder by accepting a Security
agrees, that the Guarantee is expressly subordinated in right of payment to the
prior payment in full of all Senior Indebtedness, to the same extent and in the
same manner as the Indebtedness evidenced by the Securities is subordinated in
right of payment to Senior Indebtedness of the Issuer under Article 11
(including, without limitation, the payment blockage provisions of Section
11.3), and that the subordination is for the benefit of and enforceable by the
holders of Senior Indebtedness, and authorizes and directs the Trustee to take
such action as may be necessary or appropriate to acknowledge or effectuate the
subordination as provided in this Section 13.3 and appoints the Trustee as
attorney-in-fact for any and all such purposes.
Only Indebtedness of the REIT and the General Partner which is Senior
Indebtedness shall rank senior to the Guarantee. This Section 13.3 shall remain
in full force and effect as long as any Senior Indebtedness is outstanding or
any commitment to advance Senior Indebtedness exists.
SECTION 13.4 Subrogation.
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Each of the REIT and the General Partner waives all, and agrees that it
shall not exercise any, rights which it may have acquired by way of subrogation
under this guarantee or otherwise and shall not seek any reimbursement from the
Issuer in respect of moneys realized from the REIT or the General Partner
hereunder, and if any payment shall be made to the REIT or the General Partner
on account of such subrogation or reimbursement rights at any time, each and
every amount so paid shall forthwith be paid to the Trustee to be credited and
applied against the Securities, whether matured or unmatured, and then against
any other obligations arising under this Indenture and the Security Documents.
This waiver shall cease to be effective upon the satisfaction and discharge of
all obligations under this Indenture, the Securities and the Security Documents.
SECTION 13.5 Continuing Guarantee.
Each of the REIT and the General Partner agrees that this Section 13 of
the Indenture is a continuing guarantee and shall remain in full force and
effect until the payment and performance in full of the obligations contained in
this Indenture, the Securities, and the Security Documents.
ARTICLE 14
MISCELLANEOUS
SECTION 14.1 Trust Indenture Act Controls.
If any provision of this Indenture limits, qualifies or conflicts with
another provision which is required to be included in this Indenture by the TIA,
the required provisions shall control. The provisions of TIA Sections 310
through 317 that impose duties on any Person (including the provisions
automatically deemed included herein unless expressly excluded by this
Indenture) are a part of and govern this Indenture, whether or not physically
contained herein.
SECTION 14.2 Notices.
Any notices or other communications required or permitted hereunder
shall be in writing, and shall be sufficiently given if made by hand delivery,
or first class mail, postage prepaid (except that any notice by the Trustee to
the Issuer of a Default or an Event of Default under this Indenture shall be by
registered or certified mail, postage prepaid, return receipt requested), or by
a nationally-recognized overnight express courier service (which notices or
communications shall be deemed received the Business Day after the receipt
thereof by such service), addressed as follows:
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if to the Issuer, the General Partner or the REIT:
Lepercq Corporate Income Fund L.P.
c/o Lexington Corporate Properties, Inc.
355 Lexington Avenue
New York, New York 10017
Phone: (212) 692-7242
Fax: (212) 986-6972
Attention: T. Wilson Eglin
if to the Trustee:
The Chase Manhattan Bank
450 West 33rd Street
15th Floor
New York, New York 10001
Phone: (212) 946-3084
Fax: (212) 946-8161
Attention: Global Institution Services
The Issuer or the Trustee by notice to the other may designate additional or
different addresses as shall be furnished in writing by either party. Any notice
or communication to the Issuer or the Trustee shall be deemed to have been given
or made as of the date so delivered if personally delivered, and five (5)
Business Days after mailing if sent by registered or certified mail (except that
a notice of change of address shall not be deemed to have been given until
actually received by the addressee).
Any notice or communication mailed to a Securityholder shall be mailed
to the address of such Securityholder as it appears on the registration books of
the Registrar and shall be sufficiently given if so mailed within the time
prescribed.
Failure to mail a notice or communication to a Securityholder or any
defect in it shall not affect its sufficiency with respect to other
Securityholders. If a notice or communication is mailed in the manner provided
above, it is duly given, whether or not the addressee receives it.
In case by reason of the suspension of regular mail service, or by
reason of any other cause, it shall be impossible to mail any notice, as
required by this Indenture, then such method of notification as shall be made
with the approval of the Trustee shall constitute a sufficient mailing of such
notice.
If the Issuer mails any notice or communication to Securityholders, it
shall mail a copy to the Trustee and all Agents at the same time.
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SECTION 14.3 Communications by Holders with Other Holders.
Securityholders may communicate pursuant to TIA Section 312(b) with
other Securityholders with respect to their rights under this Indenture or the
Securities. The Issuer, the Trustee, the Registrar and anyone else shall have
the protection of TIA Section 312(c).
SECTION 14.4 Certificate and Opinion as to Conditions
Precedent.
Upon any request or application by the Issuer to the Trustee to take
any action under this Indenture or the Security Documents, the Issuer shall
furnish to the Trustee:
(1) an Officers' Certificate (which shall include the statements set
forth in Section 14.5) stating that, in the opinion of the signers, all
conditions precedent, if any, provided for in this Indenture and the
Security Documents relating to the proposed action have been complied
with; and
(2) an Opinion of Counsel (which shall include the statements set forth
in Section 14.5) stating that, in the opinion of such counsel, all such
conditions precedent have been complied with.
SECTION 14.5 Statements Required in Certificate and Opinion.
Each Certificate and Opinion with respect to compliance with a
condition or covenant provided for in this Indenture or the Security Documents
(except where provision is made otherwise for delivery of a Certificate or an
Opinion) shall include:
(1) a statement that the person making such certificate or opinion has
read such covenant or condition;
(2) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(3) a statement that, in the opinion of such person, he has made such
examination or investigation as is necessary to enable him to express
an informed opinion as to whether or not such covenant or condition has
been complied with;
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(4) a statement as to whether or not, in the opinion of such person,
such covenant or condition has been complied with; and
(5) such other statements as the Trustee may reasonably request.
SECTION 14.6 Rules by Trustee and Agents.
The Trustee may make reasonable rules for action by or at a meeting of
Securityholders. The Registrar, Paying Agent or Exchange Agent may make
reasonable rules for its functions.
SECTION 14.7 Record Date.
Whenever the Issuer or the Trustee solicits an act of Securityholders,
the Issuer or the Trustee, as the case may be, may fix in advance of the
solicitation of such act a date as the record date for determining
Securityholders entitled to perform said act. The record date shall be not more
than 15 days prior to the date fixed for the solicitation of said act.
SECTION 14.8 Legal Holidays.
A "Legal Holiday" is a Saturday, a Sunday or a day on which banks or
trust companies in the city in which either the Trustee, the Issuer, the General
Partner or the REIT is located are not required to be open. If a payment date is
a Legal Holiday at a place of payment, payment may be made at that place on the
next succeeding day that is not a Legal Holiday, and no interest shall accrue
for the intervening period.
SECTION 14.9 Governing Law.
THE INTERNAL LAWS OF THE STATE OF NEW YORK SHALL GOVERN THIS INDENTURE
AND THE SECURITIES WITHOUT REGARD TO THE PRINCIPLES OF CONFLICTS OF LAW THEREOF.
SECTION 14.10 No Adverse Interpretation of Other Agreements.
This Indenture may not be used to interpret another indenture, loan or
debt agreement of the Issuer or a Subsidiary. Any such indenture, loan or debt
agreement may not be used to interpret this Indenture.
SECTION 14.11 No Recourse against Others.
All liability described in Paragraph 19 of the Securities of any
trustee, officer, director, employee or shareholder, as such, of the Issuer, the
General Partner or the REIT is waived and released. There shall be no recourse
against
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the General Partner until the date on which its guarantee becomes effective
pursuant to this Indenture.
SECTION 14.12 Successors.
All agreements of the Issuer, the General Partner or the REIT in this
Indenture, the Security Documents and the Securities shall bind its successor.
All agreements of the Trustee in this Indenture and the Security Documents shall
bind its successor.
SECTION 14.13 Multiple Counterparts.
The parties may sign multiple counterparts of this Indenture. Each
signed counterpart shall be deemed an original, but all of them together
represent the same agreement.
SECTION 14.14 Table of Contents, Headings, etc.
The table of contents, cross-reference sheet and headings of the
Articles and Sections of this Indenture have been inserted for convenience of
reference only, are not to be considered a part hereof, and shall in no way
modify or restrict any of the terms or provisions hereof.
SECTION 14.15 Severability.
In case any provision in this Indenture or in the Securities shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby,
and a
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Holder shall have no claim therefor against any party hereto.
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed, all as of the date first written above.
"ISSUER"
LEPERCQ CORPORATE INCOME FUND L.P.
By: Lex GP-1, Inc., its General Partner
By:______________________________________
"REIT"
LEXINGTON CORPORATE PROPERTIES, INC.
By:______________________________________
"GENERAL PARTNER"
LEX GP-1, INC.
By:______________________________________
"TRUSTEE"
THE CHASE MANHATTAN BANK
By:______________________________________
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