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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20546
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
August 15, 1997 (August 14, 1997)
LIBERTY PROPERTY TRUST
LIBERTY PROPERTY LIMITED PARTNERSHIP
------------------------------------
(Exact name of registrants as specified in their respective charter documents)
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<S> <C> <C>
MARYLAND 1-13130 23-7768996
PENNSYLVANIA 1-13132 23-2766549
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(State or other jurisdiction (Commission (I.R.S. Employer
of incorporation) File Number) Identification No.)
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65 VALLEY STREAM PARKWAY, SUITE 100
MALVERN, PENNSYLVANIA 19355
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(Address of principal executive offices) (Zip Code)
Registrants' telephone number, including area code: (610) 648-1700
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ITEM 5: OTHER EVENTS
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On August 14, 1997, Liberty Property Limited Partnership priced a public
offering (the "Offering") of $100,000,000 principal amount of its 7.10% Senior
Notes due 2004 and $100,000,000 principal amount of its 7.25% Senior Notes due
2007. Lehman Brothers Inc., Donaldson, Lufkin & Jenrette Securities Corporation
and Smith Barney Inc. (collectively, the "Underwriters") acted as underwriters
for the Offering. The Underwriting Agreement relating to the Offering is filed
as Exhibit 1 to this Report.
In connection to the Offering, Liberty Property Limited Partnership and The
First National Bank of Chicago, as Trustee, will enter into an Indenture (a form
of which was previously filed) and a First Supplemental Indenture, each to be
dated as of August 14, 1997. A form of such First Supplemental Indenture is
filed as Exhibit 4 to this Report.
ITEM 7: FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS
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(a) Financial Statements of Businesses Acquired.
None.
(b) Pro Forma Financial Information.
None.
(c) Exhibits.
1 Underwriting Agreement, dated August 14, 1997, by and among Liberty
Property Trust, Liberty Property Limited Partnership and the
Underwriters.
4 Form of First Supplemental Indenture, to be dated as of August 14, 1997,
by and between Liberty Property Limited Partnership and The First
National Bank of Chicago.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, each
Registrant has duly caused this Report to be signed on its behalf by the
undersigned hereunto duly authorized.
LIBERTY PROPERTY TRUST
Dated: August 15, 1997 BY: /s/ GEORGE J. ALBURGER, JR.
----------------------------------------
NAME: George J. Alburger, Jr.
TITLE: Chief Financial Officer
LIBERTY PROPERTY LIMITED PARTNERSHIP
BY: LIBERTY PROPERTY TRUST, AS ITS
SOLE GENERAL PARTNER
Dated: August 15, 1997 BY: /s/ GEORGE J. ALBURGER, JR.
----------------------------------------
NAME: George J. Alburger, Jr.
TITLE: Chief Financial Officer
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EXHIBIT INDEX
1 Underwriting Agreement, dated August 14, 1997, by and among Liberty
Property Trust, Liberty Property Limited Partnership and the
Underwriters.
4 Form of First Supplemental Indenture, to be dated as of August 14, 1997,
by and between Liberty Property Limited Partnership and The First
National Bank of Chicago.
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EXHIBIT 1
$200,000,000
LIBERTY PROPERTY LIMITED PARTNERSHIP
(a Pennsylvania Limited Partnership)
$100,000,000 7.10% Senior Notes due 2004
$100,000,000 7.25% Senior Notes due 2007
UNDERWRITING AGREEMENT
August 14, 1997
Lehman Brothers Inc.,
Donaldson, Lufkin & Jenrette Securities Corporation,
Smith Barney Inc.
c/o Lehman Brothers Inc.
Three World Financial Center
New York, New York 10285
Dear Sirs:
Liberty Property Trust, a Maryland real estate investment
trust (the "Company"), and Liberty Property Limited Partnership, a Pennsylvania
limited partnership (the "Operating Partnership" and, together with the Company,
the "Transaction Entities"), each wish to confirm as follows its agreement with
Lehman Brothers Inc., Donaldson, Lufkin & Jenrette Securities Corporation and
Smith Barney Inc., (the "Underwriters," which term shall also include any
underwriter substituted as hereinafter provided in Section 9 of this Agreement),
with respect to the sale by the Operating Partnership and the purchase by the
Underwriters, acting severally and not jointly, of $100,000,000 aggregate
principal amount of its 7.10% Senior Notes due 2004 (the "2004 Notes") and
$100,000,000 aggregate principal amount of its 7.25% Senior Notes due 2007 (the
"2007 Notes" and, together with the 2004 Notes, the "Notes"), as further
described on Schedule II hereto.
Capitalized terms used but not otherwise defined herein shall
have the meanings given to those terms in the Prospectus (as herein defined).
1. Representations, Warranties and Agreements of the
Transaction Entities. Each of the Transaction Entities, jointly and severally,
represents, warrants and agrees that, as of the date hereof:
(a) Registration statements on Form S-3 (Nos. 33-94782
(the "1995 Registration Statement") and 333-22211 (the "1997
Registration Statement")), and
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any amendments thereto, with respect to one or more series of
debt securities of the Operating Partnership have (i) been
prepared by the Company and the Operating Partnership in
conformity with the requirements of the United States
Securities Act of 1933, as amended (the "Securities Act") and
the rules and regulations (the "Rules and Regulations") of the
United States Securities and Exchange Commission (the
"Commission") thereunder, (ii) been filed with the Commission
under the Securities Act and (iii) become effective under the
Securities Act; and the indenture, as supplemented by the
first supplemental indenture, each dated as of August 14, 1997
(the "Indenture"), between the Operating Partnership and The
First National Bank of Chicago, as trustee (the "Trustee"),
pursuant to which the Notes shall be issued, has been
qualified under the Trust Indenture Act of 1939 (the "Trust
Indenture Act"). Copies of such registration statements and
any amendments thereto have been delivered by the Company to
you. As used in this Agreement, "Effective Time" means, for
each such registration statement, the date and the time as of
which such registration statement, or the most recent
post-effective amendment thereto, if any, was declared
effective by the Commission; "Effective Date" means, for each
such registration statement, the date of the Effective Time;
"Preliminary Prospectus" means each prospectus included in
each such registration statement, or amendments thereto,
before it became effective under the Securities Act and any
prospectus filed with the Commission by the Company with the
consent of the Underwriters pursuant to Rule 424(a) of the
Rules and Regulations; "Registration Statement" means both the
1995 Registration Statement and the 1997 Registration
Statement, each as amended at the respective Effective Time,
including any documents incorporated by reference therein at
such time and all information contained in the final
prospectus filed with the Commission pursuant to Rule 424(b)
of the Rules and Regulations and deemed to be a part of such
registration statement as of the respective Effective Time
pursuant to paragraph (b) of Rule 430A of the Rules and
Regulations, and shall include any registration statement
filed pursuant to Rule 462(b) of the Rules and Regulations;
and "Prospectus" means such final prospectus, as first filed
with the Commission pursuant to paragraph (1) or (4) of Rule
424(b) of the Rules and Regulations. Any reference herein to
the Registration Statement, the Prospectus or a Preliminary
Prospectus shall be deemed to include the documents
incorporated or deemed to be incorporated by reference therein
which were filed under the Securities and Exchange Act of
1934, as amended (the "Exchange Act"). For purposes of this
Agreement, all references to the Registration Statement, any
Preliminary Prospectus or the Prospectus or any amendment or
supplement to any of the foregoing shall be deemed to include
the copy filed with the Commission pursuant to its Electronic
Data Gathering, Analysis and Retrieval system ("EDGAR").
(b) Each Preliminary Prospectus included as part of
the Registration Statement as originally filed or as part of
any amendment or supplement thereto, or filed pursuant to Rule
424 under the Rules and Regulations, complied when so filed in
all material respects with the provisions of the Securities
Act, and each Preliminary Prospectus delivered to the
Underwriters for use in connection with this offering was
identical to the electronically transmitted copies thereof
filed with the Commission pursuant to EDGAR, except to the
extent permitted by Regulation S-T.
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(c) The Registration Statement conforms in all
material respects, and the Prospectus and any further
amendments or supplements to the Registration Statement or the
Prospectus will, when they become effective or are filed with
the Commission, as the case may be, conform in all material
respects to the requirements of the Securities Act, the Rules
and Regulations and the Trust Indenture Act and the rules and
regulations thereunder, and do not and will not, as of the
applicable Effective Date (as to the Registration Statement
and any amendment thereto) and as of the applicable filing
date and at the Delivery Date (as defined below) (as to the
Prospectus and any amendment or supplement thereto) contain an
untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to
make the statements therein not misleading (with respect to
the Prospectus, in light of the circumstances under which they
were made); provided that no representation or warranty is
made as to information contained in or omitted from the
Registration Statement or the Prospectus in reliance upon and
in conformity with written information furnished to the
Company through the Underwriters by or on behalf of any
Underwriter specifically for inclusion therein. The Indenture
conforms in all material respects to the requirements of the
Trust Indenture Act and the rules and regulations thereunder;
provided, however, that no representation or warranty is made
as to information contained in or omitted from that part of
the Registration Statement which shall constitute the
Statement of Eligibility and Qualification on Form T-1 under
the Trust Indenture Act of the Trustee under the Indenture.
The Prospectus delivered to the Underwriters for use in
connection with this offering was identical to the
electronically transmitted copies thereof filed with the
Commission pursuant to EDGAR, except to the extent permitted
by Regulation S-T.
(d) The documents incorporated or deemed to be
incorporated by reference in the Registration Statement as of
the applicable Effective Date, the Prospectus as of its date
or any Preliminary Prospectus as of its date, complied in all
material respects with the Exchange Act and the rules and
regulations thereunder, and none of such documents, at such
dates, contained an untrue statement of a material fact or
omitted to state a material fact required to be stated therein
or necessary to make the statements therein, in the light of
the circumstances under which they were made, not misleading.
(e) No stop order suspending the effectiveness of the
Registration Statement or any part thereof has been issued and
no proceeding for that purpose has been instituted or, to the
knowledge of either of the Transaction Entities, threatened by
the Commission or by the state securities authority of any
jurisdiction. No order preventing or suspending the use of any
Preliminary Prospectus or the Prospectus has been issued and
no proceeding for that purpose has been instituted or, to the
knowledge of either of the Transaction Entities, after due
inquiry of the Commission, threatened by the Commission or by
the state securities authority of any jurisdiction.
(f) The Company has been duly formed and is validly
existing as a real estate investment trust in good standing
under the laws of the State of Maryland, is duly qualified to
do business and is in good standing in each jurisdiction in
which its ownership or lease of property or the conduct of its
business requires such qualification, and has all power and
authority necessary to own or hold its properties, to conduct
the business in which it is engaged and to enter into and
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perform its obligations under this Agreement. None of the
subsidiaries of the Company (other than the Operating
Partnership, Liberty Property Development Corp. ("Development
Corp."), Liberty Property Development Corp.-II ("Development-
II") and Liberty Special Purpose Corp. ("SP Corp.")) is a
"significant subsidiary," as such term is defined in Rule 405
of the Rules and Regulations. Except as described in the
Prospectus and other than the Property Affiliates (as defined
herein) and the Operating Partnership, Development Corp. and
SP Corp., the Company owns no direct or indirect equity
interest in any entity, except for such interests as, in the
aggregate, are not material to the condition, financial or
otherwise, or the earnings, assets, business affairs or
business prospects of the Company and its subsidiaries
considered as a single enterprise.
(g) All of the issued shares of beneficial interest
of the Company have been duly and validly authorized and
issued, are fully paid and non-assessable and conform to the
description thereof contained in the Prospectus. Except as
disclosed in the Prospectus, no shares of beneficial interest
of the Company are reserved for any purpose and except for the
equity interests in the Operating Partnership ("Units") and
the Operating Partnership's Exchangeable Subordinated
Debentures due 2001, there are no outstanding securities
convertible into or exchangeable for any shares of beneficial
interest of the Company, and no outstanding options, rights
(preemptive or otherwise) or warrants to purchase or subscribe
for shares of beneficial interest or any other securities of
the Company.
(h) The Operating Partnership has been duly formed
and is validly existing as a limited partnership in good
standing under the laws of the Commonwealth of Pennsylvania,
is duly qualified to do business and is in good standing as a
foreign limited partnership in each jurisdiction in which its
ownership or lease of property or the conduct of its business
requires such qualification, and has all partnership power and
authority necessary to own or hold its properties, to conduct
the business in which it is engaged and to enter into and
perform its obligations under this Agreement. The Company is
the sole general partner of the Operating Partnership. The
First Amended and Restated Agreement of Limited Partnership of
the Operating Partnership, as amended (the "Operating
Partnership Agreement") is in full force and effect, and the
aggregate percentage interests of the Company and the limited
partners in the Operating Partnership are as set forth in the
Prospectus. The owner's equity of the Operating Partnership is
as set forth in the Prospectus under "Capitalization." All of
the Units have been duly and validly authorized and issued,
are fully paid and, to the extent that such interests are
owned by the Company, are owned by the Company free and clear
of all liens, encumbrances, equities or claims.
(i) Development Corp. has been duly organized and is
validly existing as a corporation in good standing under the
laws of the Commonwealth of Pennsylvania, is duly qualified to
do business and is in good standing in each jurisdiction in
which its ownership or lease of property or the conduct of its
business requires such qualification, and has all corporate
power and authority necessary to own or hold its properties
and to conduct the business in which it is engaged. All of the
issued and outstanding capital stock of Development Corp. has
been duly authorized and validly issued and is fully paid and
non-assessable, has been offered and sold in compliance with
all applicable laws (including,
4
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without limitation, federal or state securities laws) and all
of the capital stock of Development Corp. owned by the
Operating Partnership, as described in the Prospectus, is
owned free and clear of any security interest, mortgage,
pledge, lien, encumbrance, claim, restriction or equities. No
shares of capital stock of Development Corp. are reserved for
any purpose, and there are no outstanding securities
convertible into or exchangeable for any capital stock of
Development Corp., and no outstanding options, rights
(preemptive or otherwise) or warrants to purchase or to
subscribe for shares of such capital stock or any other
securities of Development Corp.
(j) Development-II has been duly organized and is
validly existing as a corporation in good standing under the
laws of the Commonwealth of Pennsylvania, is duly qualified to
do business and is in good standing in each jurisdiction in
which its ownership or lease of property or the conduct of its
business requires such qualification, and has all corporate
power and authority necessary to own or hold its properties
and to conduct the business in which it is engaged. All of the
issued and outstanding capital stock of Development-II has
been duly authorized and validly issued and is fully paid and
non-assessable, has been offered and sold in compliance with
all applicable laws (including, without limitation, federal or
state securities laws) and all of the capital stock of
Development-II owned by the Operating Partnership, as
described in the Prospectus, is owned free and clear of any
security interest, mortgage, pledge, lien, encumbrance, claim,
restriction or equities. No shares of capital stock of
Development-II are reserved for any purpose, and there are no
outstanding securities convertible into or exchangeable for
any capital stock of Development- II, and no outstanding
options, rights (preemptive or otherwise) or warrants to
purchase or to subscribe for shares of such capital stock or
any other securities of Development-II.
(k) SP Corp. has been duly organized and is validly
existing as a corporation in good standing under the laws of
the Commonwealth of Pennsylvania, is duly qualified to do
business and is in good standing as a foreign corporation in
each jurisdiction in which its ownership or lease of property
or the conduct of its business requires such qualification,
and has all corporate power and authority necessary to own or
hold its properties and to conduct the business in which it is
engaged. All of the issued and outstanding capital stock of SP
Corp. has been duly authorized and validly issued and is fully
paid and non-assessable, has been offered and sold in
compliance with all applicable laws (including, without
limitation, federal or state securities laws) and all of the
capital stock of SP Corp. is owned by the Company free and
clear of any security interest, mortgage, pledge, lien,
encumbrance, claim, restriction or equities. No shares of
capital stock of SP Corp. are reserved for any purpose, and
there are no outstanding securities convertible into or
exchangeable for any capital stock of SP Corp. and no
outstanding options, rights (preemptive or otherwise) or
warrants to purchase or to subscribe for shares of such
capital stock or any other securities of SP Corp.
(l) Each of those certain partnerships holding title
to one or more of the Properties (the "Property Affiliates")
are the only entities other than the Operating Partnership
through which the Company and the Operating Partnership
own interests in the Properties. Each of the Property
Affiliates has been duly
5
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organized and is validly existing as a limited partnership in
good standing under the laws of the Commonwealth of
Pennsylvania, is duly qualified to do business and is in good
standing as a foreign limited partnership in each jurisdiction
in which its ownership or lease of property or the conduct of
its business requires such qualification, and has all power
and authority necessary to own or hold its properties and to
conduct the business in which it is engaged. Except as set
forth in the Prospectus, all of the partnership interests of
each Property Affiliate have been duly and validly authorized
and issued, are fully paid and non-assessable and all of the
partnership interests owned directly or indirectly by the
Company and the Operating Partnership, as described in the
Prospectus, are owned free and clear of any security interest,
mortgage, pledge, lien, encumbrance, claim, restriction or
equities.
(m) The Notes have been duly and validly authorized
and, when duly executed, authenticated, issued and delivered
against payment therefor as provided herein and in the
Indenture, will be duly and validly issued and outstanding,
and shall constitute valid and binding obligations on the part
of the Operating Partnership, entitled to the benefits of the
Indenture, and enforceable against the Operating Partnership
in accordance with their terms. Upon payment of the purchase
price and delivery of the Notes in accordance herewith, each
of the Underwriters will receive good, valid and marketable
title to the Notes, free and clear of all security interests,
mortgages, pledges, liens, encumbrances, claims, restrictions
and equities.
(n) The Indenture has been duly authorized, and when
duly executed and delivered by the Operating Partnership
(assuming due execution and delivery by the Trustee), shall
constitute a valid and binding agreement on the part of the
Operating Partnership, enforceable against the Operating
Partnership in accordance with its terms; the Notes and the
Indenture conform in all material respects to the descriptions
thereof contained in the Prospectus.
(o) (A) This Agreement has been duly and validly
authorized, executed and delivered by each of the Transaction
Entities, and assuming due authorization, execution and
delivery by the Underwriters, is a valid and binding agreement
of each of the Transaction Entities, enforceable against the
Transaction Entities in accordance with its terms; and (B) the
Operating Partnership Agreement and the partnership agreement
of each Property Affiliate, has been duly and validly
authorized, executed and delivered by the parties thereto and
is a valid and binding agreement of the parties thereto,
enforceable against such parties in accordance with its terms.
(p) The execution, delivery and performance of this
Agreement by each of the Transaction Entities, the execution,
delivery and performance of the Indenture by the Operating
Partnership and the consummation of the transactions
contemplated hereby and thereby will not conflict with or
result in a breach or violation of any of the terms or
provisions of, or constitute a default under, any indenture,
mortgage, deed of trust, loan agreement or other agreement or
instrument to which either of the Transaction Entities is a
party or by which either of the Transaction Entities is bound
or to which any of the Properties or other assets of either of
the Transaction Entities is subject, nor will such actions
result in any violation of the provisions of the charter,
by-laws, certificate of limited
6
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partnership or agreement of limited partnership of either of
the Transaction Entities, or any statute or any order, rule or
regulation of any court or governmental agency or body having
jurisdiction over either of the Transaction Entities or any of
their properties or assets; and except for the registration of
the Notes under the Securities Act and the qualification of
the Indenture under the Trust Indenture Act and such consents,
approvals, authorizations, registrations or qualifications as
may be required under the Exchange Act and applicable state
securities laws in connection with the purchase and
distribution of the Notes by the Underwriters, no consent,
approval, authorization or order of, or filing or registration
with, any such court or governmental agency or body is
required for the execution, delivery and performance of this
Agreement by the Transaction Entities or the Indenture by the
Operating Partnership, the consummation of the transactions
contemplated hereby and thereby, and the issuance and delivery
of the Notes.
(q) No event has occurred and is continuing that, had
the Notes been issued, would (whether or not with the giving
of notice and/or the passage of time and/or the fulfillment of
any other requirement) constitute an Event of Default (as
defined in the Indenture) under the Indenture.
(r) Other than as described in the Prospectus and
other than rights of persons whose securities are already
registered under the Securities Act, there are no contracts,
agreements or understandings between the Transaction Entities
and any person granting such person the right to require the
Company to file a registration statement under the Securities
Act with respect to any securities of either of the
Transaction Entities owned or to be owned by such person or to
require either of the Transaction Entities to include such
securities in the securities registered pursuant to the
Registration Statement or in any securities being registered
pursuant to any other registration statement filed by the
Transaction Entities under the Securities Act.
(s) Except as described or contemplated in the
Prospectus, neither Transaction Entity has sold or issued any
securities during the six-month period preceding the date of
the Prospectus, including any sales pursuant to Rule 144A
under, or Regulations D or S under, the Securities Act.
(t) Neither of the Transaction Entities nor any of
the Properties has sustained, since the date of the latest
audited financial statements included in the Prospectus, any
material loss or interference with its business from fire,
explosion, flood or other calamity, whether or not covered by
insurance, or from any labor dispute or court or governmental
action, order or decree, other than as set forth or
contemplated in the Prospectus; and, since such date, there
has not been any material change in the capital stock or
long-term debt of either of the Transaction Entities or any
material adverse change, or any development involving a
prospective material adverse change, in or affecting any of
the Properties or the general affairs, management, financial
position, shareholders' equity or results of operations of
either of the Transaction Entities, other than as set forth or
contemplated in the Prospectus.
(u) The financial statements (including the related
notes and supporting schedules) filed as part of, or
incorporated by reference in, the Registration
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Statement and the Prospectus present fairly the financial
condition and results of operations of the entities purported
to be shown thereby, at the dates and for the periods
indicated, and have been prepared in conformity with generally
accepted accounting principles applied on a consistent basis
throughout the periods involved. The Company's ratios of
earnings to fixed charges (actual and, if any, pro forma)
included in the Prospectus under the captions "Ratios of
Earnings to Fixed Charges" and in Exhibit 12.1 to the
Registration Statement have been calculated in compliance with
Item 503(d) of Regulation S-K of the Commission. Pro forma
financial information included in or incorporated by reference
in the Registration Statement and the Prospectus has been
prepared in accordance with the applicable requirements of the
Securities Act, the Rules and Regulations and AICPA guidelines
with respect to pro forma financial information and includes
all adjustments necessary to present fairly the pro forma
financial position of the respective entity or entities
presented therein at the respective dates indicated and the
results of operations for the respective periods specified.
(v) Ernst & Young LLP, who have certified certain
financial statements of the Operating Partnership, whose
reports appear in the Prospectus or are incorporated by
reference therein and who have delivered the initial letter
referred to in Section 7(f) hereof, are independent public
accountants as required by the Securities Act and the Rules
and Regulations.
(w) (A) The Operating Partnership and the Property
Affiliates have good and marketable title to each of the
Properties, free and clear of all liens, encumbrances, claims,
security interests and defects, other than those referred to
in the Prospectus or those which are not material in amount or
those which would not have a material adverse effect on the
business, operations, use or value of any of the Properties;
(B) all liens, charges, encumbrances, claims or restrictions
on or affecting any of the Properties and the assets of any
Transaction Entity which are required to be disclosed in the
Prospectus are disclosed therein; (C) except as otherwise
described in the Prospectus, neither Transaction Entity and,
to the knowledge of the Transaction Entities, no tenant of any
of the Properties is in default under (i) any space leases (as
lessor or lessee, as the case may be) relating to the
Properties, or (ii) any of the mortgages or other security
documents or other agreements encumbering or otherwise
recorded against the Properties, in each case which default
would have a material adverse effect on the applicable
Property, and neither Transaction Entity knows of any event
which, but for the passage of time or the giving of notice, or
both, would constitute such a default under any of such
documents or agreements; (D) each of the Properties complies
with all applicable codes, laws and regulations (including,
without limitation, building and zoning codes, laws and
regulations and laws relating to access to the Properties),
except for such failures to comply that would not have a
material adverse effect on the business operations, use or
value of such Property; and (E) neither Transaction Entity has
knowledge of any pending or threatened condemnation
proceedings, zoning change or other proceeding or action that
will in any material manner adversely affect the size of, use
of, improvements on, construction on or access to the
Properties.
(x) The mortgages and deeds of trust which encumber
the Properties are not convertible into equity securities of
the entity owning such Property and
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said mortgages and deeds of trust are not cross-defaulted or
cross-collateralized with any property other than other
Properties.
(y) The Operating Partnership and the Property
Affiliates have obtained title insurance on the fee or
leasehold interests in each of the Properties, in an amount at
least equal to the greater of (A) the mortgage indebtedness of
each such Property or (B) the purchase price of each such
Property.
(z) Except as disclosed in the Prospectus and except
such as in each case would not have a material adverse effect
on any Property, Property Affiliate, or Transaction Entity or
any of their subsidiaries, taken together as a whole; (A) to
the knowledge of the Transaction Entities, after due inquiry,
the operations of the Company, the Operating Partnership,
Development Corp., SP Corp., and the Properties are in
compliance with all Environmental Laws (as defined below) and
all requirements of applicable permits, licenses, approvals
and other authorizations issued pursuant to Environmental
Laws; (B) to the knowledge of the Transaction Entities, after
due inquiry, none of the Transaction Entities, the Property
Affiliates or any Property has caused or suffered to occur any
Release (as defined below) of any Hazardous Substance (as
defined below) into the Environment (as defined below) on, in,
under or from any Property, and no condition exists on, in,
under or adjacent to any Property that could result in the
incurrence of liabilities under, or any violations of, any
Environmental Law or give rise to the imposition of any Lien
(as defined below), under any Environmental Law; (C) none of
the Transaction Entities or Property Affiliates has received
any written notice of a claim under or pursuant to any
Environmental Law or under common law pertaining to Hazardous
Substances on, in, under or originating from any Property; (D)
neither of the Transaction Entities has actual knowledge of,
or received any written notice from any Governmental Authority
(as defined below) claiming, any violation of any
Environmental Law or a determination to undertake and/or
request the investigation, remediation, clean-up or removal of
any Hazardous Substance released into the Environment on, in,
under or from any Property; and (E) no Property is included
or, to the knowledge of the Transaction Entities, after due
inquiry, proposed for inclusion on the National Priorities
List issued pursuant to CERCLA (as defined below) by the
United States Environmental Protection Agency (the "EPA") or
on the Comprehensive Environmental Response, Compensation, and
Liability Information System database maintained by the EPA,
and neither of the Transaction Entities has actual knowledge
that any Property has otherwise been identified in a published
writing by the EPA as a potential CERCLA removal, remedial or
response site or, to the knowledge of the Transaction
Entities, is included on any similar list of potentially
contaminated sites pursuant to any other Environmental Law.
As used herein, "Hazardous Substance" shall include any
hazardous substance, hazardous waste, toxic substance,
pollutant or hazardous material, including, without
limitation, oil, petroleum or any petroleum-derived substance
or waste, asbestos or asbestos-containing materials, PCBs,
pesticides, explosives, radioactive materials, dioxins, urea
formaldehyde insulation or any constituent of any such
substance, pollutant or waste which is subject to regulation
under any Environmental Law (including, without limitation,
materials listed in the United States Department of
Transportation Optional Hazardous Material Table, 49 C.F.R.
S. 172.101, or in the EPA's List of Hazardous Substances and
Reportable
9
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Quantities, 40 C.F.R. Part 302); "Environment" shall mean any
surface water, drinking water, ground water, land surface,
subsurface strata, river sediment, buildings, structures, and
ambient, workplace and indoor and outdoor air; "Environmental
Law" shall mean the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended (42 U.S.C.
S. 9601 et seq.) ("CERCLA"), the Resource Conservation and
Recovery Act of 1976, as amended (42 U.S.C. S. 6901, et
seq.), the Clean Air Act, as amended (42 U.S.C. S. 7401, et
seq.), the Clean Water Act, as amended (33 U.S.C. S. 1251, et
seq.), the Toxic Substances Control Act, as amended (15 U.S.C.
S. 2601, et seq.), the Occupational Safety and Health Act of
1970, as amended (29 U.S.C. S. 651, et seq.), the Hazardous
Materials Transportation Act, as amended (49 U.S.C. S. 1801,
et seq.), and all other federal, state and local laws,
ordinances, regulations, rules and orders relating to the
protection of the Environment or of human health from
environmental effects; "Governmental Authority" shall mean any
federal, state or local governmental office, agency or
authority having the duty or authority to promulgate,
implement or enforce any Environmental Law; "Lien" shall mean,
with respect to any Property, any lien, encumbrance, penalty,
fine, charge, assessment, judgment or other liability in, on
or affecting such Property; and "Release" shall mean any
spilling, leaking, pumping, pouring, emitting, emptying,
discharging, injecting, escaping, leaching, dumping, emanating
or disposing of any Hazardous Substance into the Environment,
including, without limitation, the abandonment or discard of
barrels, containers, tanks (including, without limitation,
underground storage tanks) or other receptacles containing or
previously containing any Hazardous Substance.
(aa) Each Transaction Entity and their subsidiaries,
and each Property carries, or is covered by, insurance in such
amounts and covering such risks as is adequate for the conduct
of its business and the value of such Property and as is
customary for companies engaged in similar businesses in
similar industries.
(ab) Each Transaction Entity owns or possesses
adequate rights to use all material patents, patent
applications, trademarks, service marks, trade names,
trademark registrations, service mark registrations,
copyrights and licenses necessary for the conduct of its
business and has no reason to believe that the conduct of its
business will conflict with, and has not received any notice
of any claim of conflict with, any such rights of others.
(ac) Except as described in the Prospectus, there are
no legal or governmental proceedings pending to which either
Transaction Entity or their subsidiaries is a party or of
which any property or assets of either Transaction Entity or
their subsidiaries is the subject which, if determined
adversely to such Transaction Entity or subsidiary, could
reasonably be expected to have a material adverse effect on
the consolidated financial position, shareholders' equity,
results of operations, business or prospects of the Company;
and to the best knowledge of the Transaction Entities, no such
proceedings are threatened or contemplated by governmental
authorities or threatened by others.
(ad) There are no contracts or other documents which
are required to be described in the Prospectus or filed as
exhibits to the Registration Statement by the Securities Act
or by the Rules and Regulations which have not been described
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<PAGE>
in the Prospectus or filed as exhibits to the Registration
Statement or incorporated therein by reference as permitted by
the Rules and Regulations.
(ae) No relationship, direct or indirect, exists
between or among either of the Transaction Entities on the one
hand, and the trustees, officers, shareholders, customers or
suppliers of the Transaction Entities on the other hand, that
is required to be described in the Prospectus that is not so
described.
(af) No labor disturbance by the employees of either
Transaction Entity exists or, to the knowledge of the
Transaction Entities, is imminent which might be expected to
have a material adverse effect on the consolidated financial
position, shareholders' equity, results of operations,
business or prospects of such Transaction Entity.
(ag) Each Transaction Entity is in compliance in all
material respects with all presently applicable provisions of
the Employee Retirement Income Security Act of 1974, as
amended, including the regulations and published
interpretations thereunder ("ERISA"); no "reportable event"
(as defined in ERISA) has occurred with respect to any
"pension plan" (as defined in ERISA) for which either
Transaction Entity would have any liability; neither
Transaction Entity has incurred or expects to incur liability
under (i) Title IV of ERISA with respect to termination of, or
withdrawal from, any "pension plan" or (ii) sections 412 or
4971 of the Internal Revenue Code of 1986, as amended,
including the regulations and published interpretations
thereunder (the "Code"); and each "pension plan" for which
either Transaction Entity would have any liability that is
intended to be qualified under section 401(a) of the Code is
so qualified in all material respects and nothing has
occurred, whether by action or by failure to act, which would
cause the loss of such qualification.
(ah) Each Transaction Entity and their subsidiaries
has filed all federal, state and local income and franchise
tax returns required to be filed through the date hereof and
has paid all taxes due thereon, and no material tax deficiency
has been determined adversely to either Transaction Entity or
their subsidiaries which has had (nor does either Transaction
Entity have any knowledge of any tax deficiency which, if
determined adversely to it might have) a material adverse
effect on the financial position, shareholders' equity,
results of operations, business or prospects of such
Transaction Entity or subsidiary.
(ai) At all times since June 16, 1994, the Company,
the Operating Partnership, Development Corp., and SP Corp.
have been and upon the sale of the Notes will continue to be,
organized and operated in conformity with the requirements for
qualification of the Company as a real estate investment trust
under the Code and the proposed method of operation of the
Company, the Operating Partnership, Development Corp. and SP
Corp. will enable the Company to continue to meet the
requirements for qualification and taxation as a real estate
investment trust under the Code.
(aj) Since the date as of which information is given
in the Prospectus through the date hereof, and except as may
otherwise be disclosed or contemplated in the Prospectus,
neither Transaction Entity has (i) issued or granted any
securities, (ii) incurred any liability or obligation, direct
or contingent, other than
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<PAGE>
liabilities and obligations which were incurred in the
ordinary course of business, (iii) entered into any
transaction not in the ordinary course of business nor (iv)
declared or paid any dividend on its capital stock (other than
regular quarterly dividends).
(ak) Each Transaction Entity and their subsidiaries
(i) makes and keeps accurate books and records and (ii)
maintains internal accounting controls which provide
reasonable assurance that (A) transactions are executed in
accordance with management's authorization, (B) transactions
are recorded as necessary to permit preparation of its
financial statements and to maintain accountability for its
assets, (C) access to its assets is permitted only in
accordance with management's authorization and (D) the
reported accountability for its assets is compared with
existing assets at reasonable intervals.
(al) No Transaction Entity or any of their
subsidiaries (i) is in violation of its charter, by-laws,
certificate of limited partnership, agreement of limited
partnership or other similar organizational document, (ii) is
in default in any material respect, and no event has occurred
which, with notice or lapse of time or both, would constitute
such a default, in the due performance or observance of any
term, covenant or condition contained in any material
indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which it is a party or by which it
is bound or to which any of the Properties or any of its other
properties or assets is subject or (iii) is in violation in
any material respect of any law, ordinance, governmental rule,
regulation or court decree to which it or the Properties or
any of its other properties or assets may be subject or has
failed to obtain any material license, permit, certificate,
franchise or other governmental authorization or permit
necessary to the ownership of the Properties or any of its
other properties or assets or to the conduct of its business.
(am) Neither Transaction Entity, nor any trustee,
officer, agent, employee or other person associated with or
acting on behalf of either Transaction Entity, has used any
corporate funds for any unlawful contribution, gift,
entertainment or other unlawful expense relating to political
activity; made any direct or indirect unlawful payment to any
foreign or domestic government official or employee from
corporate funds; violated or is in violation of any provision
of the Foreign Corrupt Practices Act of 1977; or made any
bribe, rebate, payoff, influence payment, kickback or other
unlawful payment.
(an) Neither Transaction Entity or any of their
subsidiaries is an "investment company" within the meaning of
such term under the Investment Company Act of 1940 and the
rules and regulations of the Commission thereunder.
(ao) Other than this Agreement and as set forth in
the Prospectus under the heading "Underwriting," there are no
contracts, agreements or understandings between either
Transaction Entity and any person that would give rise to a
valid claim against either Transaction Entity or any
Underwriter for a brokerage commission, finder's fee or other
like payment with respect to the consummation of the
transactions contemplated by this Agreement.
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<PAGE>
(ap) Each Transaction Entity has complied with all
applicable provisions of Florida Statutes (S) 517.075,
relating to issuers doing business with Cuba.
2. Purchase of the Notes by the Underwriters. On the basis of
the representations and warranties contained in, and subject to the terms and
conditions of, this Agreement, the Operating Partnership agrees to sell to the
several Underwriters, and each of the Underwriters, severally and not jointly,
agrees to purchase from the Operating Partnership, the respective principal
amount of Notes set forth opposite that Underwriter's name in Schedule I hereto
at the purchase price set forth in Schedule II hereto plus accrued interest, if
any, from the date specified in Schedule II hereto to the date of payment and
delivery.
3. Offering of Notes by the Underwriters. The several
Underwriters propose to offer the Notes for sale upon the terms and conditions
set forth in the Prospectus.
4. Delivery of and Payment for the Notes. Delivery of and
payment for the Notes shall be made at the office of Rogers & Wells, 200 Park
Avenue, New York, New York 10166, at 10:00 A.M., New York City time, on the
third full business day following the date of this Agreement or on the fourth
full business day if this Agreement is executed after the daily closing time of
the New York Stock Exchange (unless postponed in accordance with the provisions
of Section 9 hereof), or at such other date or place as shall be determined by
agreement between the Underwriters and the Operating Partnership. This date and
time are sometimes referred to as the "Delivery Date." On the Delivery Date, the
Operating Partnership shall deliver or cause to be delivered the Notes to the
Underwriters for the account of each Underwriter against payment to or upon the
order of the Operating Partnership of the purchase price by certified or
official bank check or checks payable in same day funds or, at the discretion of
the Operating Partnership, by wire transfer in same day funds. Time shall be of
the essence, and delivery at the time and place specified pursuant to this
Agreement is a further condition of the obligation of each Underwriter
hereunder. Upon delivery, the Notes shall be registered in such names and in
such denominations as the Underwriters shall request in writing not less than
two full business days prior to the Delivery Date. For the purpose of expediting
the checking and packaging of the Notes, the Operating Partnership shall make
the Notes available for inspection by the Underwriters in New York, New York,
not later than 2:00 P.M., New York City time, on the business day prior to the
Delivery Date.
5. Further Agreements of the Transaction Entities. Each of
the Transaction Entities jointly and severally agrees:
(a) To prepare the Prospectus in a form approved by
the Underwriters and to file such Prospectus pursuant to Rule
424(b) under the Securities Act not later than the
Commission's close of business on the second business day
following the execution and delivery of this Agreement or, if
applicable, such earlier time as may be required by Rule
430A(a)(3) under the Securities Act; to make no further
amendment or any supplement to the Registration Statement or
to the Prospectus except in accordance with Section 5(e)
hereof; to advise the Underwriters, promptly after it receives
notice thereof, of the time when any amendment to the
Registration Statement has been filed or becomes effective or
any supplement to the Prospectus or any amended Prospectus has
been filed and to furnish the Underwriters with copies
thereof; to advise the Underwriters, promptly after it
receives notice thereof, of the issuance by the Commission of
any stop order or of any order preventing or suspending the
use of any Preliminary Prospectus or the Prospectus, of the
suspension of the qualification of the Notes
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<PAGE>
for offering or sale in any jurisdiction, of the initiation or
threatening of any proceeding for any such purpose, or of any
request by the Commission for the amending or supplementing of
the Registration Statement or the Prospectus or for additional
information; and, in the event of the issuance of any stop
order or of any order preventing or suspending the use of any
Preliminary Prospectus or the Prospectus or suspending any
such qualification, to use promptly its best efforts to obtain
its withdrawal;
(b) To furnish promptly to the Underwriters and to
counsel for the Underwriters such number of conformed copies
as the Underwriters shall reasonably request of the
Registration Statement as originally filed with the
Commission, and each amendment thereto filed with the
Commission, including all consents and exhibits filed
therewith or incorporated by reference therein and all
documents incorporated by reference therein;
(c) To deliver promptly to the Underwriters such
number of the following documents as the Underwriters shall
reasonably request: (i) conformed copies of the Registration
Statement as originally filed with the Commission and each
amendment thereto (in each case excluding exhibits other than
this Agreement) and (ii) each Preliminary Prospectus, the
Prospectus and any amended or supplemented Prospectus; and, if
the delivery of a prospectus is required at any time after the
applicable Effective Time in connection with the offering or
sale of the Notes or any other securities relating thereto and
if at such time any events shall have occurred as a result of
which the Prospectus as then amended or supplemented would
include an untrue statement of a material fact or omit to
state any material fact necessary in order to make the
statements therein, in the light of the circumstances under
which they were made when such Prospectus is delivered, not
misleading, or, if for any other reason it shall be necessary
to amend or supplement the Prospectus in order to comply with
the Securities Act or the Exchange Act, to notify the
Underwriters and, upon their request, to file such document
and to prepare and furnish without charge to each Underwriter
and to any dealer in securities as many copies as the
Underwriters may from time to time reasonably request of an
amended or supplemented Prospectus which will correct such
statement or omission or effect such compliance. The
aforementioned documents furnished to the Underwriters will be
identical to the electronically transmitted copies thereof
filed with the Commission pursuant to EDGAR, except to the
extent permitted by Regulation S-T.
(d) To file promptly with the Commission any
amendment to the Registration Statement or the Prospectus or
any supplement to the Prospectus that may, in the judgment of
the Company or counsel for the Underwriters, be required by
the Securities Act or requested by the Commission;
(e) Prior to filing with the Commission any amendment
to the Registration Statement or supplement to the Prospectus
or any Prospectus pursuant to Rule 424 of the Rules and
Regulations, to furnish a copy thereof to the Underwriters and
counsel for the Underwriters within a reasonable period of
time prior to the filing thereof, and that filing thereof
shall not occur if the Underwriters shall have objected in
good faith thereto;
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<PAGE>
(f) The Operating Partnership will make generally
available to its security holders as soon as practicable but
no later than 60 days after the close of the period covered
thereby an earnings statement (in form complying with the
provisions of Section 11(a) of the Securities Act and Rule 158
of the Rules and Regulations), which need not be certified by
independent certified public accountants unless required by
the Securities Act or the Rules and Regulations, covering a
twelve-month period commencing after the "effective date" (as
defined in said Rule 158) of the Registration Statement;
(g) For a period of five years following the
applicable Effective Date, to furnish to the Underwriters
copies of all materials furnished by the Operating Partnership
to its shareholders and all public reports and all reports and
financial statements furnished by the Operating Partnership to
the Commission pursuant to the Exchange Act or any rule or
regulation of the Commission thereunder;
(h) Promptly from time to time to take such action as
the Underwriters may reasonably request to qualify the Notes
for offering and sale under the securities, real estate
syndication or Blue Sky laws of such jurisdictions as the
Underwriters may request and to comply with such laws so as to
permit the continuance of sales and dealings therein in such
jurisdictions for as long as may be necessary to complete the
distribution of the Notes, except that the Operating
Partnership shall not be required in connection therewith to
qualify as a foreign corporation or to execute a consent to
service of process in any jurisdiction;
(i) Until the Delivery Date, neither the Operating
Partnership nor the Company will, directly or indirectly,
offer for sale, contract to sell, sell or otherwise dispose
of, or register for sale under the Securities Act, any debt
securities, or sell or grant options, rights or warrants with
respect to any debt securities, without the prior written
consent of Lehman Brothers Inc.;
(j) To apply the net proceeds from the sale of the
Notes in accordance with the description set forth in the
Prospectus under the caption "Use of Proceeds";
(k) To take such steps as shall be necessary to
ensure that neither the Company, the Operating Partnership nor
any of their subsidiaries shall become an "investment company"
within the meaning of such term under the Investment Company
Act of 1940 and the rules and regulations of the Commission
thereunder;
(l) Except as stated in this Agreement and in the
Preliminary Prospectus and Prospectus, neither Transaction
Entity has taken, nor will take, directly or indirectly, any
action designed to or that might reasonably be expected to
cause or result in stabilization or manipulation of the price
of the Notes to facilitate the sale or resale of the Notes;
(m) The Company will use its best efforts to continue
to meet the requirements to qualify as a "real estate
investment trust" under the Code; and
(n) If this Agreement shall be terminated by the
Underwriters because of any failure or refusal on the part of
the Transaction Entities to comply with the
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<PAGE>
terms or fulfill any of the conditions of this Agreement, the
Transaction Entities jointly and severally agree to reimburse
the Underwriters for all reasonable out-of-pocket expenses
(including fees and expenses of counsel for the Underwriters)
incurred by the Underwriters in connection herewith.
6. Expenses. The Transaction Entities jointly and severally
agree to pay (a) the costs incident to the authorization, issuance, sale and
delivery of the Notes and any taxes payable in that connection; (b) the costs
incident to the preparation, printing and filing under the Securities Act of the
Registration Statement and any amendments and exhibits thereto; (c) the costs of
distributing the Registration Statement as originally filed and each amendment
thereto and any post-effective amendments thereof (including, in each case,
exhibits), any Preliminary Prospectus, the Prospectus and any amendment or
supplement to the Prospectus, all as provided in this Agreement; (d) the costs
of producing and distributing this Agreement and any other related documents in
connection with the offering, purchase, sale and delivery of the Notes; (f) the
filing fees incident to securing any required review by the National Association
of Securities Dealers, Inc. of the terms of sale of the Notes; (g) any
applicable listing or other fees; (h) the fees and expenses of qualifying the
Notes under the securities laws of the several jurisdictions as provided in
Section 5(h) and of preparing, printing and distributing a Blue Sky Memorandum
(including related fees and expenses of counsel to the Underwriters); (i) the
fees paid to rating agencies in connection with the rating of the Notes; and (j)
all other costs and expenses incident to the performance of the obligations of
the Transaction Entities under this Agreement; provided that, except as provided
in this Section 6 and in Section 12, the Underwriters shall pay their own costs
and expenses, including the costs and expenses of their counsel, any transfer
taxes on the Notes which they may sell and the expenses of advertising any
offering of the Notes made by the Underwriters.
7. Conditions of Underwriters' Obligations. The respective
obligations of the Underwriters hereunder are subject to the accuracy, when made
and on the Delivery Date, of the representations and warranties of the
Transaction Entities contained herein, to the performance by each Transaction
Entity of its obligations hereunder, and to each of the following additional
terms and conditions:
(a) If, at the time this Agreement is executed and
delivered, it is necessary for the Registration Statement or a
post-effective amendment thereto to be declared effective
before the offering of the Notes may commence, the
Registration Statement or such post-effective amendment shall
have become effective not later than 5:30 P.M., New York City
time, on the date hereof, or at such later date and time as
shall be consented to in writing by you, and all filings, if
any, required to have been made by such time by Rules 424 and
430A under the Rules and Regulations shall have been timely
made; no stop order suspending the effectiveness of the
Registration Statement shall have been issued and no
proceeding for that purpose shall have been instituted or, to
the knowledge of the Transaction Entities or any Underwriter,
threatened by the Commission, and any request of the
Commission for additional information (to be included in the
Registration Statement or the Prospectus or otherwise) shall
have been complied with to the satisfaction of the
Underwriters.
(b) Subsequent to the effective date of this Agreement,
there shall not have occurred (i) any change, or any
development involving a prospective change, in or affecting
the condition, financial or otherwise, business, properties,
net worth, or results of operations of either Transaction
Entity or any of their
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<PAGE>
subsidiaries or any Property not contemplated by the
Prospectus, which in the opinion of the Underwriters, would
materially adversely affect the market for the Notes, or (ii)
any event or development relating to or involving either
Transaction Entity, or any partner, officer, director or
trustee of either Transaction Entity, which makes any
statement of a material fact made in the Prospectus untrue or
which, in the opinion of the Company and its counsel or the
Underwriters and their counsel, requires the making of any
addition to or change in the Prospectus in order to state a
material fact required by the Securities Act or any other law
to be stated therein or necessary in order to make the
statements therein not misleading, if amending or
supplementing the Prospectus to reflect such event or
development would, in your opinion, materially adversely
affect the market for the Notes.
(c) All corporate and partnership proceedings and other
legal matters incident to the authorization, form and validity
of this Agreement, the Indenture, the Notes, the Registration
Statement and the Prospectus, and all other legal matters
relating to this Agreement, the Indenture, the Notes, the
Registration Statement and the Prospectus and the transactions
contemplated hereby and thereby shall be reasonably
satisfactory in all material respects to counsel for the
Underwriters, and the Transaction Entities shall have
furnished to such counsel all documents and information that
they may reasonably request to enable them to pass upon such
matters.
(d) (A) Wolf, Block, Schorr and Solis-Cohen LLP shall have
furnished to the Underwriters its written opinion, as counsel
to the Transaction Entities, addressed to the Underwriters and
dated the Delivery Date, in form and substance reasonably
satisfactory to the Underwriters, to the effect that:
(i) The Company is in good standing as a foreign
trust or corporation in those jurisdictions listed in such
opinion.
(ii) The Operating Partnership has been duly formed
and is validly existing as a limited partnership under the
laws of the Commonwealth of Pennsylvania, is duly qualified
to do business as a foreign limited partnership in
Delaware, Florida, Maryland, Michigan, Minnesota, New
Jersey, North Carolina, South Carolina, Tennessee, Texas
and Virginia, and has all partnership power and authority
necessary to own or hold its properties, to conduct the
business in which it is engaged as described in the
Registration Statement and the Prospectus, and to enter
into and perform its obligations under this Agreement. The
Company is the sole general partner of the Operating
Partnership. The Operating Partnership Agreement is in full
force and effect, and the aggregate percentage interests of
the Company and the limited partners in the Operating
Partnership are as set forth in the Prospectus. All of the
partnership interests of the Operating Partnership have
been duly and validly authorized and issued, are fully paid
and, to the extent that such interests are owned by the
Company, are owned by the Company free and clear of all
liens, encumbrances, equities or claims.
(iii) Development Corp. has been duly formed and is
validly existing as a corporation in good standing under
the laws of the
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Commonwealth of Pennsylvania, is duly qualified to do
business and is in good standing as a foreign corporation
in Delaware, Florida, Maryland, New Jersey and North
Carolina, and has all corporate power and authority
necessary to own or hold its properties and to conduct the
business in which it is engaged as described in the
Registration Statement and the Prospectus. All of the
issued and outstanding capital stock of Development Corp.
has been duly authorized and validly issued and is fully
paid and non-assessable, has been offered and sold in
compliance with all applicable laws (including, without
limitation, federal or state securities laws) and all of
the capital stock of Development Corp. owned by the
Operating Partnership, as described in the Prospectus, is
owned free and clear of any security interest, mortgage,
pledge, lien, encumbrance, claim, restriction or equities.
(iv) Development-II has been duly formed and is
validly existing as a corporation in good standing under
the laws of the Commonwealth of Pennsylvania, is duly
qualified to do business and is in good standing as a
foreign corporation in Pennsylvania, and has all corporate
power and authority necessary to own or hold its properties
and to conduct the business in which it is engaged as
described in the Registration Statement and the Prospectus.
All of the issued and outstanding capital stock of
Development-II has been duly authorized and validly issued
and is fully paid and non-assessable, has been offered and
sold in compliance with all applicable laws (including,
without limitation, federal or state securities laws) and
all of the capital stock of Development-II owned by the
Operating Partnership, as described in the Prospectus, is
owned free and clear of any security interest, mortgage,
pledge, lien, encumbrance, claim, restriction or equities.
(v) SP Corp. has been duly formed and is validly
existing as a corporation in good standing under the laws
of the Commonwealth of Pennsylvania and has all corporate
and authority necessary to own or hold its properties and
to conduct the business in which it is engaged as described
in the Registration Statement and the Prospectus. All of
the issued and outstanding capital stock of SP Corp. has
been duly authorized and validly issued and is fully paid
and non-assessable, is owned by the Company free and clear
of any security interest, mortgage, pledge, lien,
encumbrance, claim, restriction or equities and has been
offered and sold in compliance with all applicable laws
(including, without limitation, federal or state securities
laws).
(vi) Each of the Property Affiliates has been duly
organized and is validly existing as a limited partnership
in good standing under the laws of the Commonwealth of
Pennsylvania, and has all partnership power and authority
necessary to own or hold its properties and to conduct the
business in which it is engaged. Except as set forth in the
Prospectus, all of the partnership interests of each
Property Affiliate have been duly and validly authorized
and issued, are fully paid and non-assessable and all of
the partnership interests owned directly or indirectly by
the Company and the Operating Partnership, as described in
the
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<PAGE>
Prospectus, are owned free and clear of any security
interest, mortgage, pledge, lien, encumbrance, claim,
restriction or equities.
(vii) (A) This Agreement has been duly and validly
authorized, executed and delivered by the Operating
Partnership, and has been duly and validly executed and
delivered by the Company, and assuming due authorization,
execution and delivery by the Underwriters and due
authorization by the Company, is a valid and binding
agreement of the Operating Partnership; and (B) the
Operating Partnership Agreement and the partnership
agreement of each Property Affiliate, have been duly and
validly authorized, executed and delivered by each
Transaction Entity party thereto and are valid and binding
agreements of the parties thereto, enforceable against such
parties in accordance with their terms.
(viii) The Indenture has been duly authorized,
executed and delivered by the Operating Partnership and
(assuming due execution and delivery by the Trustee)
constitutes a valid and binding agreement on the part of
the Operating Partnership, enforceable against the
Operating Partnership in accordance with its terms; the
Indenture conforms in all material respects to the
descriptions thereof contained in the Prospectus.
(ix) The Notes have been duly authorized, executed,
issued and delivered by the Operating Partnership, and
constitute valid and binding obligations of the Operating
Partnership entitled to the benefits of the Indenture and
enforceable against the Operating Partnership in accordance
with their terms. Upon payment of the purchase price and
delivery of the Notes in accordance herewith, each of the
Underwriters will receive good, valid and marketable title
to the Notes, which to such counsel's knowledge, after due
inquiry, are free and clear of all security interests,
mortgages, pledges, liens, encumbrances, claims,
restrictions and equities. The terms of the Notes conform
to all statements and descriptions related thereto
contained in the Prospectus. The Notes rank and will rank
on a parity with all unsecured indebtedness (other than
subordinated indebtedness of the Operating Partnership that
is outstanding on the date thereof or that may be incurred
thereafter), and senior to all subordinated indebtedness of
the Operating Partnership that is outstanding on the date
thereof or that may be incurred thereafter, except that the
Notes will be effectively subordinated to the prior claims
of each secured mortgage lender to any specific Property
which secures such lender's mortgage.
(x) To the best knowledge of such counsel, the
execution, delivery and performance of this Agreement by
each of the Transaction Entities and the consummation of
the transactions contemplated hereby will not (i) conflict
with or result in a breach or violation of any of the terms
or provisions of, or constitute a default under, any
indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which either of the Transaction
Entities or their subsidiaries is a party or by which
either of the Transaction Entities or their subsidiaries is
bound or to which any of the Properties or other assets of
either of the Transaction Entities or their subsidiaries is
subject, or (ii)
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<PAGE>
conflict with or result in any violation of the provisions
of any statute or any order, rule or regulation of any
court or governmental agency or body having jurisdiction
over either of the Transaction Entities or their
subsidiaries or any of their properties or assets; and
except for the registration of the Notes under the
Securities Act and the qualification of the Indenture under
the Trust Indenture Act and such consents, approvals,
authorizations, registrations or qualifications as may be
required under the Exchange Act and applicable state
securities laws in connection with the purchase and
distribution of the Notes by the Underwriters, no consent,
approval, authorization or order of, or filing or
registration with, any such court or governmental agency or
body is required for the execution, delivery and
performance of this Agreement or the Indenture by the
Transaction Entities and the consummation of the
transactions contemplated hereby and thereby, and the
issuance and delivery of the Notes.
(xi) The issuance and delivery of the Notes by the
Operating Partnership and the compliance by the Operating
Partnership with all of the provisions of this Agreement,
and the consummation of the transactions contemplated
hereby, have been duly authorized by all necessary
partnership action. The execution, delivery and performance
of this Agreement by each of the Transaction Entities and
the consummation of the transactions contemplated hereby
will not conflict with or result in any violation of the
provisions of the charter, by-laws, certificate of limited
partnership or agreement of limited partnership of either
of the Transaction Entities or their subsidiaries.
(xii) Except as set forth in the Prospectus, to the
knowledge of such counsel, there are no preemptive or other
rights to subscribe for or to purchase, nor any restriction
upon the transfer of the Notes pursuant to the Operating
Partnership's certificate of limited partnership, its
agreement of limited partnership, as amended to the date
hereof, or any agreement or other instrument to which the
Operating Partnership is a party.
(xiii) To the best knowledge of such counsel, other
than as set forth in the Prospectus and other than rights
of persons whose securities are already registered under
the Securities Act, there are no contracts, agreements or
understandings between the Company and/or the Operating
Partnership, on the one hand, and any person, on the other,
granting such person the right to require the Company or
the Operating Partnership to file a registration statement
under the Securities Act with respect to any securities of
the Company or the Operating Partnership owned or to be
owned by such person or to require the Company or the
Operating Partnership to include such securities in the
securities registered pursuant to the Registration
Statement or in any securities being registered pursuant to
any other registration statement filed by the Company or
the Operating Partnership under the Securities Act.
(xiv) To the best knowledge of such counsel, there
are no legal or governmental proceedings pending to which
either Transaction
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Entity or their subsidiaries is a party or of which
any property or assets of either Transaction Entity
or their subsidiaries is the subject which are not
disclosed in the Prospectus and which, if determined
adversely to such Transaction Entity or subsidiary,
might reasonably be expected to have a material
adverse effect on the consolidated financial
position, shareholders' equity, results of
operations, business or prospects of the Company; and
to the best knowledge of such counsel no such
proceedings are threatened or contemplated by
governmental authorities or threatened by others.
(xv) To the best knowledge of such
counsel, there are no contracts or other documents
which are required to be described in the Prospectus
or filed as exhibits to the Registration Statement by
the Securities Act or by the Rules and Regulations
which have not been described in the Prospectus or
filed as exhibits to the Registration Statement or
incorporated therein by reference as permitted by the
Rules and Regulations.
(xvi) To the best knowledge of such
counsel, no relationship, direct or indirect, exists
between or among either of the Transaction Entities
on the one hand, and the trustees, officers,
shareholders, customers or suppliers of the
Transaction Entities on the other hand, which is
required to be described in the Prospectus which is
not so described.
(xvii) To the best knowledge of such
counsel, each Transaction Entity is in compliance in
all material respects with all presently applicable
provisions of ERISA; to the best knowledge of such
counsel, no "reportable event" (as defined in ERISA)
has occurred with respect to any "pension plan" (as
defined in ERISA) for which either Transaction Entity
would have any liability; to the best knowledge of
such counsel, neither Transaction Entity has incurred
or expects to incur, liability under (i) Title IV of
ERISA with respect to termination of, or withdrawal
from, any "pension plan" or (ii) section 412 or 4971
of the Code; and, to the best knowledge of such
counsel, each "pension plan" for which either
Transaction Entity would have any liability that is
intended to be qualified under section 401(a) of the
Code is so qualified in all material respects and
nothing has occurred, whether by action or by failure
to act, which would cause the loss of such
qualification.
(xviii) No Transaction Entity or
Property Affiliate is in violation of its charter,
by-laws, certificate of limited partnership,
agreement of limited partnership, or other similar
organizational document, or, to the best knowledge of
such counsel, has a default been asserted in any
respect, and it has not been asserted that any event
has occurred which, with notice or lapse of time or
both, would constitute such a default, in the due
performance or observance of any term, covenant or
condition contained in any material indenture,
mortgage, deed of trust, loan agreement or other
material agreement or instrument to which it is a
party or by which it is bound or to which any of the
Properties or any of its other properties or assets
is subject.
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(xix) No consent, approval,
authorization or other order of, or registration or
filing with, any court, regulatory body,
administrative agency or other governmental body,
agency, or official is required on the part of the
Company (except as have been obtained under the
Securities Act and the Exchange Act or such as may be
required under state securities, real estate
syndication or Blue Sky laws governing the purchase
and distribution of the Notes) for the valid issuance
and sale of the Notes to the Underwriters as
contemplated by this Agreement.
(xx) Neither Transaction Entity or
their subsidiaries is an "investment company" within
the meaning of such term under the Investment Company
Act of 1940 and the rules and regulations of the
Commission thereunder.
(xxi) The documents incorporated or
deemed to be incorporated by reference in the
Prospectus pursuant to Item 12 of Form S-3 under the
Securities Act (other than the financial statements
and related schedules and financial information and
data included therein, as to which no opinion need be
rendered), at the time they were filed with the
Commission, complied and will comply as to form in
all material respects with the requirements of the
Exchange Act and the rules and regulations
thereunder.
(xxii) The Registration Statement was
declared effective under the Securities Act and the
Indenture was duly qualified under the Trust
Indenture Act as of the date and time specified in
such opinion, the Prospectus was filed with the
Commission pursuant to the subparagraph of Rule
424(b) of the Rules and Regulations specified in such
opinion on the date specified therein and, to the
best knowledge of such counsel, no stop order
suspending the effectiveness of the Registration
Statement has been issued and, to the best knowledge
of such counsel, no proceeding for that purpose is
pending or threatened by the Commission.
(xxiii) The Registration Statement and
the Prospectus and any further amendments or
supplements thereto made by the Company prior to the
Delivery Date (other than the financial statements
and related schedules and other financial information
and data included therein, as to which such counsel
need express no opinion) comply as to form in all
material respects with the requirements of the
Securities Act, the Rules and Regulations and the
Trust Indenture Act and the rules and regulations
thereunder, and the Indenture conforms in all
material respects to the requirements of the Trust
Indenture Act and the rules and regulations
thereunder.
(xxiv) The Operating Partnership is
classified as a partnership (and is not taxed as a
corporation) for federal income tax purposes.
(xxv) The statements contained in the
Prospectus under the captions "Risk Factors,"
"Management," "Description of Debt Securities,"
"Description of Preferred Shares," "Description of
Warrants," "Description
22
<PAGE>
of Notes," and "Federal Income Tax Considerations
with Respect to the Trust and the Operating
Partnership," insofar as those statements are
descriptions of contracts, agreements or other legal
documents, or they describe federal statutes, rules
and regulations, and except to the extent such
statements are statistics or calculations constitute
a fair summary thereof.
In rendering such opinion, such counsel may (i) state that its
opinion is limited to matters governed by the Federal laws of
the United States of America, the laws of the Commonwealth of
Pennsylvania and the laws of the State of Maryland; (ii) as to
matters of Maryland law, state that its opinion is given
solely in reliance upon the opinion of Weinberg & Green LLC;
(iii) state that its opinion does not address (A) Federal
Reserve Board margin regulations; (B) Federal or state
antitrust and unfair competition laws and regulations; (C)
Local Laws (as defined in The Legal Opinion Accord of the ABA
Section of Business Law (1991); (D) compliance with fiduciary
duty requirements; (E) Federal and state racketeering laws and
regulations; (F) Federal and state health and safety laws and
regulations; and (G) Federal and state laws, regulations and
policies concerning (x) national and local emergency, (y)
possible judicial deference to acts of foreign states, and (z)
criminal and civil forfeiture laws; and (iv) in giving the
opinion referred to in subclause (B) in Section
7(d)(A)(vi)(A), state that such opinion with respect to the
enforceability of such documents may be limited by bankruptcy,
fraudulent conveyance, insolvency, reorganization, moratorium,
and other laws relating to or affecting creditors' rights
generally and by general equitable principles. Such counsel
shall also have furnished to the Underwriters a written
statement, addressed to the Underwriters and dated the
Delivery Date, in form and substance satisfactory to the
Underwriters, to the effect that (x) such counsel has acted as
counsel to the Company in connection with the preparation of
the Registration Statement and the Prospectus, and (y) based
on the foregoing, no facts have come to the attention of such
counsel which lead it to believe that the Registration
Statement, as of the Effective Date, contained any untrue
statement of a material fact or omitted to state a material
fact required to be stated therein or necessary in order to
make the statements therein not misleading, or that the
Prospectus contains any untrue statement of a material fact or
omits to state a material fact required to be stated therein
or necessary in order to make the statements therein, in light
of the circumstances under which they were made, not
misleading. The foregoing opinion and statement may be
qualified by a statement to the effect that such counsel does
not assume any responsibility for the accuracy, completeness
or fairness of the statements contained in the Registration
Statement or the Prospectus except to the extent of the
opinion contained in Section 7(d)(A)(xxii), and may state that
such counsel expresses no belief with respect to the financial
statements and notes thereto and other financial information
and data included or incorporated by reference in, or omitted
from, the Registration Statement or the Prospectus or the
Statement of Eligibility on Form T-1 of the Trustee.
(B) Weinberg & Green LLC shall have
furnished to the Underwriters its written opinion, as Maryland
counsel to the Company, addressed to the Underwriters and
dated the Delivery Date, in form and substance reasonably
satisfactory to the Underwriters, to the effect that:
23
<PAGE>
(i) The Company has been duly
formed and is validly existing as a real estate
investment trust in good standing under and by virtue
of the laws of the State of Maryland, is in good
standing with the State Department of Assessments and
Taxation of Maryland and as a foreign trust or
corporation in those jurisdictions listed in such
opinion, and has all trust power and authority
necessary to own or hold its properties and to
conduct the business in which it is engaged as
described in the Registration Statement and the
Prospectus, and to enter into and perform its
obligations under this Agreement.
(ii) All of the issued shares of
beneficial interest of the Company have been duly and
validly authorized and issued, are fully paid and
non-assessable and conform in all material respects
to the description thereof contained in the
Prospectus.
(iii) This Agreement has been duly
and validly authorized, executed and delivered by the
Company, and assuming due authorization, execution
and delivery by the Underwriters and the Operating
Partnership, is a valid and binding agreement of the
Company.
(iv) To the knowledge of such
counsel, the execution, delivery and performance of
this Agreement by the Company and the consummation of
the transactions contemplated hereby will not
conflict with or result in any violation of the
provisions of any statute or any order, rule or
regulation of any court or governmental agency or
body of the State of Maryland that has jurisdiction
over the Company or any of its properties or assets.
(v) The execution, delivery and
performance of this Agreement by the Company and the
consummation of the transactions contemplated hereby
will not conflict with or result in any violation of
the provisions of the Declaration of Trust or by-laws
of the Company.
(vi) To the knowledge of such
counsel, there are no legal or governmental
proceedings pending to which the Company is a party
or of which any property or assets of the Company is
the subject which are not disclosed in the Prospectus
and which, if determined adversely to the Company,
might reasonably be expected to have a material
adverse effect on the consolidated financial
position, shareholders' equity, results of
operations, business or prospects of the Company; and
to the best knowledge of such counsel no such
proceedings are threatened or contemplated by
governmental authorities or threatened by others.
Such counsel shall state that Rogers & Wells, counsel for the
Underwriters, may rely on its opinion.
(e) The Underwriters shall have received from Rogers
& Wells, counsel for the Underwriters, such opinion or
opinions, dated the Delivery Date, with respect to the
issuance and sale of the Notes, the Registration Statement,
the Prospectus and other related matters as the Underwriters
may reasonably require,
24
<PAGE>
and the Company shall have furnished to such counsel such
documents as they reasonably request for the purpose of
enabling them to pass upon such matters.
(f) At the time of execution of this Agreement, the
Underwriters shall have received from Ernst & Young LLP a
letter, in form and substance satisfactory to the
Underwriters, addressed to the Underwriters and dated the date
hereof (i) confirming that they are independent public
accountants within the meaning of the Securities Act and are
in compliance with the applicable requirements relating to the
qualification of accountants under Rule 2-01 of Regulation S-X
of the Commission, and (ii) stating, as of the date hereof
(or, with respect to matters involving changes or developments
since the respective dates as of which specified financial
information is given in, or incorporated by reference in, the
Prospectus, as of a date not more than five days prior to the
date hereof), the conclusions and findings of such firm with
respect to the financial information and other matters
ordinarily covered by accountants' "comfort letters" to
underwriters in connection with registered public offerings.
(g) With respect to the letter of Ernst & Young LLP
referred to in the preceding paragraph and delivered to the
Underwriters concurrently with the execution of this Agreement
(the "initial letter"), the Operating Partnership shall have
furnished to the Underwriters a letter (the "bring-down
letter") of such accountants, addressed to the Underwriters
and dated the Delivery Date (i) confirming that they are
independent public accountants within the meaning of the
Securities Act and are in compliance with the applicable
requirements relating to the qualification of accountants
under Rule 2-01 of Regulation S-X of the Commission, (ii)
stating, as of the date of the bring-down letter (or, with
respect to matters involving changes or developments since the
respective dates as of which specified financial information
is given in the Prospectus, as of a date not more than five
days prior to the date of the bring-down letter), the
conclusions and findings of such firm with respect to the
financial information and other matters covered by the initial
letter and (iii) confirming in all material respects the
conclusions and findings set forth in the initial letter.
(h) The Transaction Entities shall have furnished to
the Underwriters a certificate, dated the Delivery Date, of
the Chairman of the Board, Chief Executive Officer, President
or a Vice President of the Company and the chief financial
officer of the Company (in each case, for the Company and for
the Company as general partner of the Operating Partnership)
stating that:
(i) The representations, warranties
and agreements of the Transaction Entities in Section
1 are true and correct as of the Delivery Date; the
Transaction Entities complied with all of their
agreements contained herein; and the conditions set
forth in Sections 7(a) and 7(i) have been fulfilled;
and
(ii) They have carefully examined
the Registration Statement and the Prospectus and, in
their opinion (A) as of the applicable Effective
Date, the Registration Statement and Prospectus did
not include any untrue statement of a material fact
and did not omit to state a material fact required to
be stated therein or necessary to make the statements
therein not misleading (with respect to the
Prospectus, in light of the
25
<PAGE>
circumstances in which they were made), and (B) since
the applicable Effective Date no event has occurred
which should have been set forth in a supplement or
amendment to the Registration Statement or the
Prospectus.
(i) (i) None of the Transaction Entities or their
subsidiaries or any Property shall have sustained since the
date of the latest audited financial statements included in
the Prospectus any loss or interference with its business from
fire, explosion, flood or other calamity, whether or not
covered by insurance, or from any labor dispute or court or
governmental action, order or decree, otherwise than as set
forth or contemplated in the Prospectus or (ii) since such
date there shall not have been any change in the capital stock
or long-term debt of either Transaction Entity or any change,
or any development involving a prospective change, in or
affecting any Property Affiliate or Property or the general
affairs, management, financial position, shareholders' equity
or results of operations of either Transaction Entity,
otherwise than as set forth or contemplated in the Prospectus,
the effect of which, in any such case described in clause (i)
or (ii), is, in the judgment of the Underwriters, so material
and adverse as to make it impracticable or inadvisable to
proceed with the public offering or the delivery of the Notes
being delivered on the Delivery Date on the terms and in the
manner contemplated in the Prospectus.
(j) Subsequent to the execution and delivery of this
Agreement there shall not have occurred any of the following:
(i) trading in securities generally on the New York Stock
Exchange or the American Stock Exchange or in the
over-the-counter market, or trading in any securities of the
Company on any exchange or in the over-the-counter market,
shall have been suspended or minimum prices shall have been
established on any such exchange or such market by the
Commission, by such exchange or by any other regulatory body
or governmental authority having jurisdiction, (ii) a banking
moratorium shall have been declared by Federal or state
authorities, (iii) the United States shall have become engaged
in hostilities, there shall have been an escalation in
hostilities involving the United States or there shall have
been a declaration of a national emergency or war by the
United States or (iv) there shall have occurred such a
material adverse change in general economic, political or
financial conditions (or the effect of international
conditions on the financial markets in the United States shall
be such) as to make it, in the judgment of a majority in
interest of the several Underwriters, impracticable or
inadvisable to proceed with the public offering or delivery of
the Notes being delivered on the Delivery Date on the terms
and in the manner contemplated in the Prospectus.
(k) Subsequent to the execution and delivery of this
Agreement (i) no downgrading shall have occurred in the rating
accorded the Operating Partnership's debt securities by any
"nationally recognized statistical rating organization," as
that term is defined by the Commission for purposes of Rule
436(g)(2) of the Rules and Regulations and (ii) no such
organization shall have publicly announced that it has under
surveillance or review, with possible negative implications,
its rating of any of the Operating Partnership's debt
securities.
(l) The Transaction Entities shall not have failed at
or prior to the Delivery Date to have performed or complied
with any of their agreements herein
26
<PAGE>
contained and required to be performed or complied with by
them hereunder at or prior to the Delivery Date.
(m) On the Delivery Date, counsel for the
Underwriters shall have been furnished with such documents and
opinions as they may require for the purpose of enabling them
to pass upon the issuance and sale of the Notes as herein
contemplated and related proceedings, or in order to evidence
the accuracy of any of the representations or warranties, or
the fulfillment of any of the conditions, herein contained;
and all proceedings taken by the Transaction Entities in
connection with the issuance and sale of the Notes as herein
contemplated shall be satisfactory in form and substance to
the Underwriters and counsel for the Underwriters.
(n) The Operating Partnership shall have furnished or
caused to be furnished to the Underwriters such further
certificates and documents as the Underwriters shall have
reasonably requested.
All opinions, letters, evidence and certificates mentioned
above or elsewhere in this Agreement shall be deemed to be in compliance with
the provisions hereof only if they are in form and substance reasonably
satisfactory to counsel for the Underwriters.
Any certificate or document signed by any officer of the
Transaction Entities and delivered to the Underwriters, or to counsel for the
Underwriters, shall be deemed a representation and warranty by the Transaction
Entities to each Underwriter as to the statements made therein.
8. Effective Date of Agreement. This Agreement shall become
effective: (i) upon the execution hereof by the parties hereto; or (ii) if, at
the time this Agreement is executed and delivered, it is necessary for the
Registration Statement or a post-effective amendment thereto to be declared
effective before the offering of the Notes may commence, when notification of
the effectiveness of the Registration Statement or such post-effective amendment
has been released by the Commission.
9. Default by One or More of the Underwriters. If, on the
Delivery Date, any Underwriter defaults in the performance of its obligations
under this Agreement, the remaining non-defaulting Underwriters shall be
obligated to purchase the Notes which the defaulting Underwriter agreed but
failed to purchase on the Delivery Date in the respective proportions which the
principal amount of Notes set forth opposite the name of each remaining
non-defaulting Underwriter in Schedule I hereto bears to the total aggregate
principal amount of Notes set forth opposite the names of all the remaining
non-defaulting Underwriters in Schedule I hereto; provided, however, that the
remaining non-defaulting Underwriters shall not be obligated to purchase any of
the Notes on the Delivery Date if the total aggregate principal amount of Notes
which the defaulting Underwriter or Underwriters agreed but failed to purchase
on such date exceeds 9.09% of the total aggregate principal amount of Notes to
be purchased on the Delivery Date, and any remaining non-defaulting Underwriter
shall not be obligated to purchase more than 110% of the aggregate principal
amount of Notes which it agreed to purchase on the Delivery Date pursuant to the
terms of Section 2. If the foregoing maximums are exceeded, the remaining non-
defaulting Underwriters, or those other underwriters satisfactory to the
Underwriters who so agree, shall have the right, but shall not be obligated, to
purchase, in such proportion as may be agreed upon among them, all the Notes to
be purchased on the Delivery Date. If the remaining Underwriters or other
underwriters satisfactory to the Underwriters do not elect to purchase the
27
<PAGE>
Notes which the defaulting Underwriter or Underwriters agreed but failed to
purchase on the Delivery Date, this Agreement shall terminate without liability
on the part of any non-defaulting Underwriter or the Transaction Entities,
except that the Transaction Entities will continue to be liable for the payment
of expenses to the extent set forth in Sections 6 and 12. As used in this
Agreement, the term "Underwriter" includes, for all purposes of this Agreement
unless the context requires otherwise, any party not listed in Schedule I hereto
who, pursuant to this Section 9, purchases Notes which a defaulting Underwriter
agreed but failed to purchase.
Nothing contained herein shall relieve a defaulting
Underwriter of any liability it may have to the Transaction Entities for damages
caused by its default. If other underwriters are obligated or agree to purchase
the Notes of a defaulting or withdrawing Underwriter, either the Underwriters or
the Company may postpone the Delivery Date for up to seven full business days in
order to effect any changes that in the opinion of counsel for the Operating
Partnership or counsel for the Underwriters may be necessary in the Registration
Statement, the Prospectus or in any other document or arrangement.
10. Indemnification and Contribution.
(a) The Transaction Entities jointly and severally, shall
indemnify and hold harmless each Underwriter, its officers and employees and
each person, if any, who controls any Underwriter within the meaning of the
Securities Act, from and against any loss, claim, damage or liability, joint or
several, or any action in respect thereof (including, but not limited to, any
loss, claim, damage, liability or action relating to purchases and sales of
Notes), to which that Underwriter, officer, employee or controlling person may
become subject, under the Securities Act or otherwise, insofar as such loss,
claim, damage, liability or action arises out of, or is based upon, (i) any
untrue statement or alleged untrue statement of a material fact contained (A) in
any Preliminary Prospectus, the Registration Statement or the Prospectus or in
any amendment or supplement thereto or (B) in any blue sky application or other
document prepared or executed by the Operating Partnership (or based upon any
written information furnished by the Operating Partnership) specifically for the
purpose of qualifying any or all of the Notes under the securities laws of any
state or other jurisdiction (any such application, document or information being
hereinafter called a "Blue Sky Application"), (ii) the omission or alleged
omission to state in any Preliminary Prospectus, the Registration Statement or
the Prospectus, or in any amendment or supplement thereto, or in any Blue Sky
Application any material fact required to be stated therein or necessary to make
the statements therein not misleading (with respect to the Prospectus, in light
of the circumstances under which they were made), or (iii) any act or failure to
act or any alleged act or failure to act by any Underwriter in connection with,
or relating in any manner to, the Notes or the offering contemplated hereby, and
which is included as part of or referred to in any loss, claim, damage,
liability or action arising out of or based upon matters covered by clause (i)
or (ii) above (provided that the Transaction Entities shall not be liable under
this clause (iii) to the extent that it is determined in a final judgment by a
court of competent jurisdiction that such loss, claim, damage, liability or
action resulted directly from any such acts or failures to act undertaken or
omitted to be taken by such Underwriter through its gross negligence or willful
misconduct), and shall reimburse each Underwriter and each such officer,
employee or controlling person for any legal or other expenses reasonably
incurred by that Underwriter, officer, employee or controlling person in
connection with investigating or defending or preparing to defend against any
such loss, claim, damage, liability or action as such expenses are incurred;
provided, however, that the Transaction Entities shall not be liable in any such
case to the extent that any such loss, claim, damage, liability or action arises
out of, or is based upon, any untrue statement or alleged untrue statement or
omission or alleged omission made in any Preliminary Prospectus, the
Registration Statement or the Prospectus, or in any such amendment or
supplement, or in any
28
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Blue Sky Application, in reliance upon and in conformity with written
information concerning such Underwriter furnished to the Transaction Entities
through the Underwriters by or on behalf of any Underwriter specifically for
inclusion therein. The foregoing indemnity agreement is in addition to any
liability which the Transaction Entities may otherwise have to any Underwriter
or to any officer, employee or controlling person of that Underwriter.
(b) Each Underwriter, severally and not jointly, shall
indemnify and hold harmless each Transaction Entity, its officers and employees,
each of its trustees, and each person, if any, who controls each Transaction
Entity within the meaning of the Securities Act, from and against any loss,
claim, damage or liability, joint or several, or any action in respect thereof,
to which each Transaction Entity or any such trustee, officer or controlling
person may become subject, under the Securities Act or otherwise, insofar as
such loss, claim, damage, liability or action arises out of, or is based upon,
(i) any untrue statement or alleged untrue statement of a material fact
contained (A) in any Preliminary Prospectus, the Registration Statement or the
Prospectus or in any amendment or supplement thereto, or (B) in any Blue Sky
Application or (ii) the omission or alleged omission to state in any Preliminary
Prospectus, the Registration Statement or the Prospectus, or in any amendment or
supplement thereto, or in any Blue Sky Application any material fact required to
be stated therein or necessary to make the statements therein not misleading,
but in each case only to the extent that the untrue statement or alleged untrue
statement or omission or alleged omission was made in reliance upon and in
conformity with written information concerning such Underwriter furnished to the
Transaction Entities through the Underwriters by or on behalf of that
Underwriter specifically for inclusion therein, and shall reimburse each
Transaction Entity and any such trustee, officer or controlling person for any
legal or other expenses reasonably incurred by each Transaction Entity or any
such trustee, officer or controlling person in connection with investigating or
defending or preparing to defend against any such loss, claim, damage, liability
or action as such expenses are incurred. The foregoing indemnity agreement is in
addition to any liability which any Underwriter may otherwise have to each
Transaction Entity or any such trustee, officer, employee or controlling person.
(c) Promptly after receipt by an indemnified party under this
Section 10 of notice of any claim or the commencement of any action, the
indemnified party shall, if a claim in respect thereof is to be made against the
indemnifying party under this Section 10, notify the indemnifying party in
writing of the claim or the commencement of that action; provided, however, that
the failure to notify the indemnifying party shall not relieve it from any
liability which it may have under this Section 10 except to the extent it has
been materially prejudiced by such failure and, provided further, that the
failure to notify the indemnifying party shall not relieve it from any liability
which it may have to an indemnified party otherwise than under this Section 10.
If any such claim or action shall be brought against an indemnified party, and
it shall notify the indemnifying party thereof, the indemnifying party shall be
entitled to participate therein and, to the extent that it wishes, jointly with
any other similarly notified indemnifying party, to assume the defense thereof
with counsel reasonably satisfactory to the indemnified party. After notice from
the indemnifying party to the indemnified party of its election to assume the
defense of such claim or action, the indemnifying party shall not be liable to
the indemnified party under this Section 10 for any legal or other expenses
subsequently incurred by the indemnified party in connection with the defense
thereof other than reasonable costs of investigation; provided, however, that
the indemnified party shall have the right to employ its own counsel, with such
counsel, in the case of the Underwriters, to represent jointly the Underwriters
and their respective officers, employees and controlling persons who may be
subject to liability arising out of any claim in respect of which indemnity may
be sought by the Underwriters against the Transaction Entities under this
Section 10 if, in the reasonable judgment of the Underwriters,
29
<PAGE>
it is advisable for the Underwriters and those officers, employees and
controlling persons to be jointly represented by separate counsel, and in that
event the fees and expenses of such separate counsel shall be paid by the
Transaction Entities. No indemnifying party shall (i) without the prior written
consent of the indemnified parties (which consent shall not be unreasonably
withheld), settle or compromise or consent to the entry of any judgment with
respect to any pending or threatened claim, action, suit or proceeding in
respect of which indemnification or contribution may be sought hereunder
(whether or not the indemnified parties are actual or potential parties to such
claim or action) unless such settlement, compromise or consent includes an
unconditional release of each indemnified party from all liability arising out
of such claim, action, suit or proceeding, or (ii) be liable for any settlement
of any such action effected without its written consent (which consent shall not
be unreasonably withheld), but if settled with the consent of the indemnifying
party or if there be a final judgment of the plaintiff in any such action, the
indemnifying party agrees to indemnify and hold harmless any indemnified party
from and against any loss or liability by reason of such settlement or judgment.
(d) If the indemnification provided for in this Section 10
shall for any reason be unavailable to or insufficient to hold harmless an
indemnified party under Section 10(a) or 10(c) in respect of any loss, claim,
damage or liability, or any action in respect thereof, referred to therein, then
each indemnifying party shall, in lieu of indemnifying such indemnified party,
contribute to the amount paid or payable by such indemnified party as a result
of such loss, claim, damage or liability, or action in respect thereof, (i) in
such proportion as shall be appropriate to reflect the relative benefits
received by the Transaction Entities on the one hand and the Underwriters on the
other from the offering of the Notes or (ii) if the allocation provided by
clause (i) above is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause (i)
above but also the relative fault of the Transaction Entities on the one hand
and the Underwriters on the other with respect to the statements or omissions
which resulted in such loss, claim, damage or liability, or action in respect
thereof, as well as any other relevant equitable considerations. The relative
benefits received by the Transaction Entities on the one hand and the
Underwriters on the other with respect to such offering shall be deemed to be in
the same proportion as the total net proceeds from the offering of the Notes
purchased under this Agreement (before deducting expenses) received by the
Transaction Entities, on the one hand, and the total underwriting discounts and
commissions received by the Underwriters with respect to the Notes purchased
under this Agreement, on the other hand, bear to the total gross proceeds from
the offering of the Notes under this Agreement, in each case as set forth in the
table on the cover page of the Prospectus. The relative fault shall be
determined by reference to whether the untrue or alleged untrue statement of a
material fact or omission or alleged omission to state a material fact relates
to information supplied by the Transaction Entities or the Underwriters, the
intent of the parties and their relative knowledge, access to information and
opportunity to correct or prevent such statement or omission. The Transaction
Entities and the Underwriters agree that it would not be just and equitable if
contributions pursuant to this Section were to be determined by pro rata
allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation which does not take into account
the equitable considerations referred to herein. The amount paid or payable by
an indemnified party as a result of the loss, claim, damage or liability, or
action in respect thereof, referred to above in this Section shall be deemed to
include, for purposes of this Section 10(d), any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending any such action or claim. Notwithstanding the provisions of this
Section 10(d), no Underwriter shall be required to contribute any amount in
excess of the amount by which the total price at which the Notes underwritten by
it and distributed to the public was offered to the public exceeds the amount of
any damages which such Underwriter has otherwise paid or become liable to pay by
reason of
30
<PAGE>
any untrue or alleged untrue statement or omission or alleged
omission. No person guilty of fraudulent misrepresentation (within the meaning
of section 11(f) of the Securities Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation. The
Underwriters' obligations to contribute as provided in this Section 10(d) are
several in proportion to their respective underwriting obligations and not
joint.
(e) The Underwriters severally confirm and each Transaction
Entity acknowledges that the statements with respect to the public offering of
the Notes by the Underwriters set forth on the cover page of, the legend
concerning stabilization on page S-3 of, the concession and reallowance figures
appearing under the caption "Underwriting" and, pursuant to Item 508 of
Regulation S-K of the Securities Act, the last six paragraphs of the section
captioned "Plan of Distribution" in, the Preliminary Prospectus and the
comparable material in the Prospectus are correct and constitute the only
information concerning such Underwriters furnished in writing to the Transaction
Entities by or on behalf of the Underwriters specifically for inclusion in the
Registration Statement, the Preliminary Prospectus and the Prospectus.
11. Termination. The obligations of the Underwriters hereunder
may be terminated by the Underwriters by notice given to and received by the
Operating Partnership prior to delivery of and payment for the Notes if, prior
to that time, any of the events described in Sections 7(i), 7(j) or 7(l), shall
have occurred or if the Underwriters shall decline to purchase the Notes for any
reason permitted under this Agreement.
12. Reimbursement of Underwriters' Expenses. If the Operating
Partnership shall fail to tender the Notes for delivery to the Underwriters by
reason of any failure, refusal or inability on the part of the Transaction
Entities to perform any agreement on their part to be performed, or because any
other condition of the Underwriters' obligations hereunder required to be
fulfilled by the Transaction Entities is not fulfilled, the Transaction Entities
will reimburse the Underwriters for all reasonable out-of-pocket expenses
(including fees and disbursements of counsel) incurred by the Underwriters in
connection with this Agreement and the proposed purchase of the Notes, and upon
demand the Transaction Entities shall pay the full amount thereof to the
Underwriters. If this Agreement is terminated pursuant to Section 9 by reason of
the default of one or more Underwriters, the Transaction Entities shall not be
obligated to reimburse any defaulting Underwriter on account of those expenses.
13. Notices, etc. All statements, requests, notices and
agreements hereunder shall be in writing, and:
(a) if to the Underwriters, shall be delivered or
sent by mail, telex or facsimile transmission to Lehman
Brothers Inc., Three World Financial Center, New York, New
York 10285, Attention: Syndicate Department (Fax: 212-526-
6588), with a copy, in the case of any notice pursuant to
Section 10(c), to the Director of Litigation, Office of the
General Counsel, Lehman Brothers Inc., 3 World Financial
Center, 10th Floor, New York, NY 10285;
(b) if to the Transaction Entities shall be delivered
or sent by mail, telex or facsimile transmission to the
Company, 65 Valley Stream Parkway, Malvern, PA 19355,
Attention: General Counsel (Fax: 610-644-2175);
provided, however, that any notice to an Underwriter pursuant to Section 10(c)
shall be delivered or sent by mail, telex or facsimile transmission to such
Underwriter at its address set forth in its acceptance telex to the
Underwriters, which address will be supplied to any other party hereto
31
<PAGE>
by the Underwriters upon request. Any such statements, requests, notices or
agreements shall take effect at the time of receipt thereof. The Transaction
Entities shall be entitled to act and rely upon any request, consent, notice or
agreement given or made on behalf of the Underwriters by Lehman Brothers Inc.
14. Persons Entitled to Benefit of Agreement. This Agreement
shall inure to the benefit of and be binding upon the Underwriters, the
Transaction Entities and their respective personal representatives and
successors. This Agreement and the terms and provisions hereof are for the sole
benefit of only those persons, except that (A) the representations, warranties,
indemnities and agreements of the Transaction Entities contained in this
Agreement shall also be deemed to be for the benefit of the person or persons,
if any, who control any Underwriter within the meaning of Section 15 of the
Securities Act and (B) the indemnity agreement of the Underwriters contained in
Section 10(b) of this Agreement shall be deemed to be for the benefit of
trustees of the Company, officers of the Company who have signed the
Registration Statement and any person controlling the Transaction Entities
within the meaning of section 15 of the Securities Act. Nothing in this
Agreement is intended or shall be construed to give any person, other than the
persons referred to in this Section 14, any legal or equitable right, remedy or
claim under or in respect of this Agreement or any provision contained herein.
15. Survival. The respective indemnities, representations,
warranties and agreements of the Transaction Entities and the Underwriters
contained in this Agreement or made by or on behalf on them, respectively,
pursuant to this Agreement, shall survive the delivery of and payment for the
Notes and shall remain in full force and effect, regardless of any investigation
made by or on behalf of any of them or any person controlling any of them.
16. Definition of the Terms "Business Day" and "Subsidiary".
For purposes of this Agreement, (a) "business day" means any day on which the
New York Stock Exchange, Inc. is open for trading and (b) "subsidiary" has the
meaning set forth in Rule 405 of the Rules and Regulations.
17. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of New York.
18. Counterparts. This Agreement may be executed in one or
more counterparts and, if executed in more than one counterpart, the executed
counterparts shall each be deemed to be an original but all such counterparts
shall together constitute one and the same instrument.
19. Headings. The headings herein are inserted for convenience
of reference only and are not intended to be part of, or to affect the meaning
or interpretation of, this Agreement.
32
<PAGE>
If the foregoing correctly sets forth the agreement between
the Company and the Underwriters, please indicate your acceptance in the space
provided for that purpose below.
Very truly yours,
LIBERTY PROPERTY TRUST
By: /s/ Willard G. Rouse III
---------------------------------------------
Name: Willard G. Rouse III
Title: Chairman of the Board and Chief
Executive Officer
LIBERTY PROPERTY LIMITED PARTNERSHIP
By: Liberty Property Trust, its general partner
By: /s/ Willard G. Rouse III
---------------------------------------------
Name: Willard G. Rouse III
Title: Chairman of the Board and
Chief Executive Officer
Accepted:
LEHMAN BROTHERS INC.
By /s/ Michael W. Reid
--------------------------------------
Authorized Representative
For itself and on behalf of
the Underwriters
33
<PAGE>
SCHEDULE I
----------
<TABLE>
<CAPTION>
Principal Amount Principal Amount
Underwriters of 2004 Notes of 2007 Notes
- ------------ ----------------- ----------------
<S> <C> <C>
Lehman Brothers Inc. $ 47,500,000 $ 47,500,000
Donaldson, Lufkin & Jenrette Securities Corporation 47,500,000 47,500,000
Smith Barney Inc. 5,000,000 5,000,000
----------------- ----------------
Total $100,000,000 $100,000,000
============ ============
</TABLE>
34
<PAGE>
SCHEDULE II
-----------
Senior Notes Due 2004
- ---------------------
Principal Amount $100,000,000.00
Coupon: 7.10%
Settlement Date: August 19, 1997
Price to Public: 99.971%
Price to Public: $99,971,000
Underwriting Discount: 0.625%
Underwriting Discount: $625,000
Price to Underwriter: 99.346%
Proceeds to the Company $99,346,000
Maturity Date: August 15, 2004
Senior Notes Due 2007
- ---------------------
Principal Amount $100,000,000.00
Coupon: 7.25%
Settlement Date: August 19, 1997
Price to Public: 99.858%
Price to Public: $99,858,000
Underwriting Discount: 0.650%
Underwriting Discount: $650,000
Price to Underwriter: 99.208%
Proceeds to the Company $99,208,000
Maturity Date: August 15, 2007
2004 Notes and 2007 Notes
- -------------------------
Total Price to Public: $199,829,000
Total Underwriting Discount: $1,275,000
Total Proceeds to the Company: $198,554,000
35
<PAGE>
Exhibit 4
================================================================================
LIBERTY PROPERTY LIMITED PARTNERSHIP
ISSUER
TO
THE FIRST NATIONAL BANK OF CHICAGO
TRUSTEE
-----------
FIRST SUPPLEMENTAL INDENTURE
DATED AS OF AUGUST 14, 1997
-----------
$100,000,000 7.10% SENIOR NOTES DUE 2004
$100,000,000 7.25% SENIOR NOTES DUE 2007
-----------
SUPPLEMENT TO INDENTURE,
DATED AS OF AUGUST 14, 1997, BETWEEN
LIBERTY PROPERTY LIMITED PARTNERSHIP AND
THE FIRST NATIONAL BANK OF CHICAGO
================================================================================
<PAGE>
FIRST SUPPLEMENTAL INDENTURE, dated as of August 14, 1997,
between LIBERTY PROPERTY LIMITED PARTNERSHIP, a Pennsylvania limited partnership
(the "Issuer"), having its principal offices at 65 Valley Stream Parkway,
Malvern, Pennsylvania 19355, and THE FIRST NATIONAL BANK OF CHICAGO, a national
banking association organized under the laws of the United States of America, as
trustee (the "Trustee"), having its Corporate Trust Office at One First National
Plaza, Suite 0126, Chicago, Illinois 60670-0126.
RECITALS
WHEREAS, the Issuer executed and delivered its Indenture (the
"Original Indenture"), dated as of August 14, 1997, to the Trustee to issue from
time to time for its lawful purposes debt securities evidencing its unsecured
indebtedness.
WHEREAS, the Original Indenture provides that by means of a
supplemental indenture, the Issuer may create one or more series of its debt
securities and establish the form and terms and conditions thereof.
WHEREAS, the Issuer intends by this Supplemental Indenture to
(i) create a series of debt securities, in an aggregate principal amount not to
exceed $100,000,000, entitled "Liberty Property Limited Partnership 7.10% Senior
Notes due 2004" (the "2004 Notes"); (ii) create a series of debt securities, in
an aggregate principal amount not to exceed $100,000,000, entitled "Liberty
Property Limited Partnership 7.25% Senior Notes due 2007" (the "2007 Notes, and
together with the 2004 Notes, the "Notes"); and (iii) establish the form and the
terms and conditions of such Notes.
WHEREAS, the Board of Trustees of Liberty Property Trust, the
general partner of the Issuer, has approved the creation of the Notes and the
form, terms and conditions thereof.
WHEREAS, the consent of Holders to the execution and delivery
of this Supplemental Indenture is not required, and all other actions required
to be taken under the Original Indenture with respect to this Supplemental
Indenture have been taken.
NOW, THEREFORE IT IS AGREED:
ARTICLE ONE
Definitions, Creation, Form and Terms and Conditions of the Debt Securities
SECTION 1.01 Definitions. Capitalized terms used in this Supplemental
-----------
Indenture and not otherwise defined shall have the meanings ascribed to them in
the Original Indenture. In addition, the following terms shall have the
following meanings to be equally applicable to both the singular and the plural
forms of the terms defined:
"Global Note" means a single fully-registered global note in
book-entry form, without coupons, substantially in the form of Exhibit A or
Exhibit B attached hereto.
2
<PAGE>
"Indenture" means the Original Indenture as supplemented by this First
Supplemental Indenture.
"Intercompany Debt" means Debt to which the only parties are
the Trust, any of its subsidiaries, the Issuer and any Subsidiary, or Debt owed
to the Trust arising from routine cash management practices, but only so long as
such Debt is held solely by any of the Trust, any of its subsidiaries, the
Issuer and any Subsidiary.
"Notes" means the 2004 Notes together with the 2007 Notes.
"2004 Notes" means the Issuer's 7.10% Senior Notes due August
15, 2004, a form of which is attached hereto as Exhibit A.
"2007 Notes" means the Issuer's 7.25% Senior Notes due August
15, 2007, a form of which is attached hereto as Exhibit B.
SECTION 1.02 Creation of the Debt Securities. In accordance with
-------------------------------
Section 301 of the Original Indenture, the Issuer hereby creates each of the
2004 Notes and the 2007 Notes as separate series of its debt securities issued
pursuant to the Indenture. The 2004 Notes shall be issued in an aggregate
principal amount not to exceed $100,000,000. The 2007 Notes shall be issued in
an aggregate principal amount not to exceed $100,000,000.
SECTION 1.03 Form of the Debt Securities. Each series of Notes will
---------------------------
be represented by a single fully-registered global note in book-entry form,
without coupons, registered in the name of the nominee of DTC. The 2004 Notes
shall be in the form of Exhibit A attached hereto and the 2007 Notes shall be in
the form of Exhibit B attached hereto. So long as DTC, or its nominee, is the
registered owner of a Global Note, DTC or its nominee, as the case may be, will
be considered the sole owner or holder of the Notes represented by such Global
Note for all purposes under the Indenture. Ownership of beneficial interests in
the Global Notes will be shown on, and transfers thereof will be effected only
through, records maintained by DTC (with respect to beneficial interests of
participants) or by participants or persons that hold interests through
participants (with respect to beneficial interests of beneficial owners).
SECTION 1.04 Terms and Conditions of the Debt Securities. The Notes
-------------------------------------------
shall be governed by all the terms and conditions of the Original Indenture, as
supplemented by this First Supplemental Indenture, and in particular, the
following provisions shall be terms of the Notes:
(a) Optional Redemption. The Issuer may redeem the Notes of either or
-------------------
both series at any time at the option of the Issuer, in whole or from time to
time in part, at a redemption price equal to the Redemption Price.
If notice of redemption has been given as provided in the Original
Indenture and funds for the redemption of any Notes called for redemption shall
have been made available on the
3
<PAGE>
Redemption Date referred to in such notice, such Notes will cease to bear
interest on the date fixed for such redemption specified in such notice and the
only right of the Holders of such Notes from and after the Redemption Date will
be to receive payment of the Redemption Price upon surrender of such Notes in
accordance with such notice.
Notice of any optional redemption of any Notes will be given to Holders
at their addresses, as shown in the security register for the Notes, not more
than 60 nor less than 30 days prior to the date fixed for redemption. The notice
of redemption will specify, among other items, the Redemption Price and the
principal amount of the Notes held by such Holder to be redeemed.
If all or less than all of the Notes of any series are to be redeemed
at the option of the Issuer, the Issuer will notify the Trustee at least 45 days
prior to giving notice of redemption (or such shorter period as is satisfactory
to the Trustee) of the aggregate principal amount of Notes to be redeemed, if
less than all of the Notes of any series are to be redeemed, and their
Redemption Date. The Trustee shall select, in such manner as it shall deem fair
and appropriate, no less than 60 days prior to the date of redemption, the Notes
to be redeemed in whole or in part.
(b) Payment of Principal and Interest. Principal and interest
---------------------------------
payments on interests represented by a Global Note will be made to DTC or its
nominee, as the case may be, as the registered owner of such Global Note. All
payments of principal and interest in respect of the Notes will be made by the
Issuer in immediately available funds.
(c) Applicability of Defeasance or Covenant Defeasance. The
--------------------------------------------------
provisions of Article 14 of the Original Indenture shall apply to the Notes.
ARTICLE TWO
Additional Covenants
The Notes shall be governed by all the covenants contained in the
Original Indenture, as supplemented by this First Supplemental Indenture, and in
particular, this First Supplemental Indenture amends Section 1004 of the
Original Indenture to read as follows:
"SECTION 1004. Limitations on Incurrence of Debt.
(a) The Issuer will not, and will not permit any Subsidiary to, incur
any Debt, other than Intercompany Debt, that is subordinate in right of payment
to the Notes, if, immediately after giving effect to the incurrence of such Debt
and the application of the proceeds thereof, the aggregate principal amount of
all outstanding Debt of the Issuer and its Subsidiaries on a consolidated basis
determined in accordance with GAAP is greater than 60% of the sum of (i) the
Issuer's Adjusted Total Assets as of the end of the most recent fiscal quarter
prior to the incurrence of such additional Debt and (ii) the increase in
Adjusted Total Assets since the end of such quarter (including any increase
resulting from the incurrence of additional Debt).
4
<PAGE>
(b) The Issuer will not, and will not permit any Subsidiary to, incur
any Debt if the ratio of Consolidated Income Available for Debt Service to the
Annual Service Charge on the date on which such additional Debt is to be
incurred would have been less than 1.5 to 1, on a pro forma basis, after giving
effect to the incurrence of such Debt and to the application of the proceeds
thereof.
(c) The Issuer will not, and will not permit any Subsidiary to, incur
any Debt secured by any mortgage, lien, charge, pledge, encumbrance or security
interest of any kind upon any of the properties of the Issuer or any Subsidiary
("Secured Debt"), whether owned at the date hereof or hereafter acquired, if,
immediately after giving effect to the incurrence of such Secured Debt and the
application of the proceeds thereof, the aggregate principal amount of all
outstanding Secured Debt of the Issuer and its Subsidiaries on a consolidated
basis is greater than 40% of the sum of (i) the Issuer's Adjusted Total Assets
as of the end of the most recent fiscal quarter prior to the incurrence of such
additional Debt and (ii) the increase in Adjusted Total Assets since the end of
such quarter (including any increase resulting from the incurrence of additional
Debt).
(d) The Issuer will at all time maintain an Unencumbered Total Asset
Value in an amount not less than 150% of the aggregate principal amount of all
outstanding unsecured Debt of the Issuer and its Subsidiaries on a consolidated
basis.
For purposes of the foregoing provisions regarding the limitation
on the incurrence of Debt, Debt shall be deemed to be "incurred" by the Issuer
or a Subsidiary whenever the Issuer or such Subsidiary shall create, assume,
guarantee or otherwise become liable in respect thereof."
ARTICLE THREE
Trustee
SECTION 3.01 Trustee. The Trustee shall not be responsible in any
-------
manner whatsoever for or in respect of the validity or sufficiency of this
Supplemental Indenture or the due execution thereof by the Issuer. The recitals
of fact contained herein shall be taken as the statements solely of the Issuer,
and the Trustee assumes no responsibility for the correctness thereof.
ARTICLE FOUR
Miscellaneous Provisions
SECTION 4.01 Ratification of Original Indenture. This Supplemental
----------------------------------
Indenture is executed and shall be construed as an indenture supplemental to the
Original Indenture, and as supplemented and modified hereby, the Original
Indenture is in all respects ratified and confirmed, and the Original Indenture
and this Supplemental Indenture shall be read, taken and construed as one and
the same instrument.
5
<PAGE>
SECTION 4.02 Effect of Headings. The Article and Section headings
------------------
herein are for convenience only and shall not affect the construction hereof.
SECTION 4.03 Successors and Assigns. All covenants and agreements in
----------------------
this Supplemental Indenture by the Issuer shall bind its successors and assigns,
whether so expressed or not.
SECTION 4.04 Separability Clause. In case any one or more of the
-------------------
provisions contained in this Supplemental Indenture shall for any reason be held
to be invalid, illegal or unenforceable in any respect, the validity, legality
and enforceability of the remaining provisions shall not in any way be affected
or impaired thereby.
SECTION 4.05 Governing Law. This Supplemental Indenture shall be
-------------
governed by and construed in accordance with the laws of the State of New York.
This Supplemental Indenture is subject to the provisions of the Trust Indenture
Act, that are required to be part of this Supplemental Indenture and shall, to
the extent applicable, be governed by such provisions.
SECTION 4.06 Counterparts. This Supplemental Indenture may be
------------
executed in any number of counterparts, and each of such counterparts shall for
all purposes be deemed to be an original, but all such counterparts shall
together constitute one and the same instrument.
6
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture to be duly executed, and their respective corporate seals to be
hereunto affixed and attested, all as of the date first above written.
LIBERTY PROPERTY LIMITED PARTNERSHIP
By: Liberty Property Trust,
as its sole General Partner
By:
---------------------------
Name:
Title:
Attest:
- ---------------------------------
Name:
Title:
THE FIRST NATIONAL BANK OF CHICAGO,
as Trustee
By:
------------------------------------
Name:
Title:
Attest:
- ---------------------------------
Name:
Title:
<PAGE>
STATE OF ___________ )
) ss:
COUNTY OF __________ )
On the ___________ day of August 1997, before me personally came
____________________, to me known, who, being by me duly sworn, did depose and
say that he/she resides at _____________________________________, that he/she is
________________ of LIBERTY PROPERTY TRUST, the sole general partner of LIBERTY
PROPERTY LIMITED PARTNERSHIP, one of the parties described in and which executed
the foregoing instrument, and that he/she signed his/her name thereto by
authority of the Board of Trustees.
[Notarial Seal]
------------------------------------
Notary Public
COMMISSION EXPIRES
<PAGE>
STATE OF ____________ )
) ss:
COUNTY OF ____________ )
On the __________ day of August 1997, before me personally came
____________________, to me known, who, being by me duly sworn, did depose and
say that he/she resides at _____________________________________, that he/she is
a _______________ of THE FIRST NATIONAL BANK OF CHICAGO, one of the parties
described in and which executed the foregoing instrument, and that he/she signed
his/her name thereto by authority of the Board of Directors.
[Notarial Seal]
------------------------------------
Notary Public
COMMISSION EXPIRES
<PAGE>
Exhibit A
---------
THIS NOTE IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER
REFERRED TO. UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"),
TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT AND
ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER
NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC AND ANY PAYMENT IS
MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC, ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
UNLESS AND UNTIL THIS CERTIFICATE IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN
CERTIFICATED FORM, THIS CERTIFICATE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY
DTC TO A NOMINEE THEREOF OR BY A NOMINEE THEREOF TO DTC OR ANOTHER NOMINEE OF
DTC OR BY DTC OR ANY SUCH NOMINEE TO A SUCCESSOR OF DTC OR A NOMINEE OF SUCH
SUCCESSOR.
REGISTERED REGISTERED
NO. [__________] PRINCIPAL AMOUNT
CUSIP NO. [___________] $100,000,000
LIBERTY PROPERTY LIMITED PARTNERSHIP
7.10% Senior Notes due 2004
Liberty Property Limited Partnership, a Pennsylvania limited
partnership (the "Issuer," which term includes any successor under the Indenture
hereinafter referred to), for value received, hereby promises to pay to Cede &
Co. or its registered assigns, the principal sum of One Hundred Million Dollars
on August 15, 2004 (the "Maturity Date"), and to pay interest thereon from
August 19, 1997 (or from the most recent interest payment date to which interest
has been paid or duly provided for), semi-annually in arrears on February 15 and
August 15 of each year (each, an "Interest Payment Date"), commencing on
February 15, 1997, and on the Maturity Date, at the rate of 7.10% per annum,
until payment of said principal sum has been made or duly provided for.
The interest so payable and punctually paid or duly provided
for on any Interest Payment Date and on the Maturity Date will be paid to the
Holder in whose name this Note (or
A-1
<PAGE>
one or more predecessor Notes) is registered at the close of business on the
"Record Date" for such payment, which will be 15 days (regardless of whether
such day is a Business Day (as defined below)) prior to such payment date or the
Maturity Date, as the case may be. Any interest not so punctually paid or duly
provided for shall forthwith cease to be payable to the Holder on such record
date, and shall be paid to the Holder in whose name this Note (or one or more
predecessor Notes) is registered at the close of business on a subsequent record
date for the payment of such defaulted interest (which shall be not be more
than 15 days and not less than 10 days prior to the date of the payment of such
defaulted interest) established by notice given by mail by or on behalf of the
Issuer to the Holders of the Notes not less than 10 days preceding such
subsequent record date. Interest on this Note will be computed on the basis of a
360-day year of twelve 30-day months.
The principal of this Note payable on the Maturity Date will
be paid against presentation and surrender of this Note at the corporate trust
office of the Trustee at One First National Plaza, Chicago, Illinois 60670-0126,
in such coin or currency of the United States of America as at the time of
payment is legal tender for payment of public or private debt.
Interest payable on this Note on any Interest Payment Date and
on the Maturity Date, as the case may be, will be the amount of interest accrued
from and including the immediately preceding Interest Payment Date (or from and
including August 19, 1997, in the case of the initial Interest Payment Date) to
but excluding the applicable Interest Payment Date or the Maturity Date, as the
case may be. If any Interest Payment Date or the Maturity Date falls on a day
that is not a Business Day (as defined below), the required payment of interest
or principal or both, as the case may be, will be made on the next Business Day
with the same force and effect as if it were made on the date such payment was
due and no interest will accrue on the amount so payable for the period from and
after such Interest Payment Date or the Maturity Date, as the case may be.
"Business Day" means any day, other than a Saturday or a Sunday, that is neither
a legal holiday nor a day on which banking institutions in The City of New York
or Chicago are authorized or required by law, regulation or executive order to
close.
Payments of principal and interest in respect of this Note
will be made by wire transfer of immediately available funds in such coin or
currency of the United States of America as at the time of payment is legal
tender for the payment of public and private debts.
Reference is made to the further provisions of this Note set
forth on the reverse hereof. Such further provisions shall for all purposes have
the same effect as though fully set forth at this place.
This Note shall not be entitled to the benefits of the
Indenture referred to on the reverse hereof or be valid or become obligatory for
any purpose until the certificate of authentication hereon shall have been
signed by the Trustee under such Indenture.
A-2
<PAGE>
IN WITNESS WHEREOF, the Issuer has caused this instrument to
be signed manually or by facsimile by its authorized officers.
Dated: August __, 1997
LIBERTY PROPERTY LIMITED PARTNERSHIP,
as Issuer
By: LIBERTY PROPERTY TRUST,
as its sole General Partner
By:
----------------------------------
Name:
Title:
By:
----------------------------------
Name:
Title:
<PAGE>
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated herein
referred to in the within-mentioned Indenture.
THE FIRST NATIONAL BANK OF CHICAGO,
as Trustee
By:
---------------------------------
Authorized Officer
<PAGE>
[REVERSE OF NOTE]
LIBERTY PROPERTY LIMITED PARTNERSHIP
7.10% Senior Notes due 2004
This security is one of a duly authorized issue of debentures,
notes, bonds, or other evidences of indebtedness of the Issuer (hereinafter
called the "Securities") of the series hereinafter specified, all issued or to
be issued under and pursuant to an Indenture dated as of August 14, 1997 (herein
called the "Indenture"), duly executed and delivered by the Issuer to The First
National Bank of Chicago, as Trustee (herein called the "Trustee," which term
includes any successor trustee under the Indenture with respect to the series of
Securities of which this Note is a part), to which Indenture and all indentures
supplemental thereto relating to this security reference is hereby made for a
description of the rights, limitations of rights, obligations, duties, and
immunities thereunder of the Trustee, the Issuer, and the Holders of the
Securities, and of the terms upon which the Securities are, and are to be,
authenticated and delivered. The Securities may be issued in one or more series,
which different series may be issued in various aggregate principal amounts, may
mature at different times, may bear interest (if any) at different rates, may be
subject to different redemption provisions (if any), and may otherwise vary as
provided in the Indenture or any indenture supplemental thereto. This security
is one of a series designated as the 7.10% Notes due August 15, 2004 of the
Issuer, limited in aggregate principal amount to $100,000,000.
In case an Event of Default with respect to this security
shall have occurred and be continuing, the principal hereof and Make-Whole
Amount, if any, may be declared, and upon such declaration shall become, due and
payable, in the manner, with the effect, and subject to the conditions provided
in the Indenture.
The Issuer may redeem this security at any time at the option
of the Issuer, in whole or from time to time in part, at a redemption price
equal to the sum of (i) the principal amount of this security being redeemed
plus accrued interest thereon to the Redemption Date and (ii) the Make-Whole
Amount, if any, with respect to this security. Notice of any optional redemption
of any Securities will be given to Holders at their addresses, as shown in the
security register for the Securities, not more than 60 nor less than 30 days
prior to the date fixed for redemption. The notice of redemption will specify,
among other items, the Redemption Price and the principal amount of the
Securities held by such Holder to be redeemed.
The Indenture contains provisions permitting the Issuer and
the Trustee, with the consent of the Holders of not less than a majority of the
aggregate principal amount of the Securities at the time Outstanding of all
series to be affected (voting as one class), evidenced as provided in the
Indenture, to execute supplemental indentures adding any provisions to or
changing in any manner or eliminating any of the provisions of the Indenture or
of any supplemental indenture or modifying in any manner the rights of the
Holders of the Securities of each series; provided, however, that no such
supplemental indenture shall, without the consent of the Holder of each Security
so affected, (i) change the Stated Maturity of the principal of (or premium or
Make-Whole Amount, if any, on) or any installment of interest on, any such
Security; (ii) reduce the principal
A-5
<PAGE>
amount of, or the rate or amount of interest on, or any premium payable on
redemption of the Securities, or adversely affect any right of repayment of the
Holder of any Securities; (iii) change the place of payment, or the coin or
currency, for payment of principal or premium, if any, or interest on the
Securities; (iv) impair the right to institute suit for the enforcement of any
payment on or with respect to the Securities on or after the stated maturity of
any such Security; (v) reduce the above-stated percentage in principal amount of
outstanding Securities the consent of whose Holders is necessary to modify or
amend the Indenture, for any waiver with respect to the Securities or to waive
compliance with certain provisions of the Indenture or certain defaults and
consequences thereunder or to reduce the quorum or voting requirements set forth
in the Indenture; or (vi) modify any of the foregoing provisions or any of the
provisions relating to the waiver of certain past defaults or certain covenants,
except to increase the required percentage to effect such action or to provide
that certain other provisions of the Indenture may not be modified or waived
without the consent of the Holder of each Security. It is also provided in the
Indenture that, with respect to certain defaults or Events of Default regarding
the Securities of any series, the Holders of a majority in aggregate principal
amount outstanding of the Securities of such series (or, in the case of certain
defaults or Events of Default, all series of Securities) may on behalf of the
Holders of all the Securities of such series (or all of the Securities, as the
case may be) waive any such past default or Event of Default and its
consequences, prior to any declaration accelerating the maturity of such
Securities, or, subject to certain conditions, may rescind a declaration of
acceleration and its consequences with respect to such Securities. Any such
consent or waiver by the Holder of this Security (unless revoked as provided in
the Indenture) shall be conclusive and binding upon such Holder and upon all
future Holders and owners of this Security and any Securities that may be issued
in exchange or substitution herefor, irrespective of whether or not any notation
thereof is made upon this security or such other securities.
No reference herein to the Indenture and no provision of this
security or of the Indenture shall alter or impair the obligation of the Issuer,
which is absolute and unconditional, to pay the principal of and any Make-Whole
Amount and interest on this security in the manner, at the respective times, at
the rate and in the coin or currency herein prescribed.
This security is issuable only in registered form without
coupons in denominations of $1,000 and integral multiples thereof. Securities
may be exchanged for a like aggregate principal amount of securities of this
series of other authorized denominations at the office or agency of the Issuer
in The Borough of Manhattan, The City of New York, in the manner and subject to
the limitations provided in the Indenture, but without the payment of any
service charge except for any tax or other governmental charge imposed in
connection therewith.
Upon due presentment for registration of transfer of
Securities at the office or agency of the Issuer in The Borough of Manhattan,
The City of New York, one or more new Securities of the same series of
authorized denominations in an equal aggregate principal amount will be issued
to the transferee in exchange therefor, subject to the limitations provided in
the Indenture, without charge except for any tax or other governmental charge
imposed in connection therewith.
The Issuer, the Trustee or any authorized agent of the Issuer
or the Trustee may deem and treat the Person in whose name this security is
registered as the absolute owner of this security (whether or not this security
shall be overdue and notwithstanding any notation of ownership or other writing
hereon), for the purpose of receiving payment of, or on account of,
A-6
<PAGE>
the principal hereof and Make-Whole Amount, if any, and subject to the
provisions on the face hereof, interest hereon, and for all other purposes, and
neither the Issuer nor the Trustee nor any authorized agent of the Issuer or the
Trustee shall be affected by any notice to the contrary.
The Indenture and each Security shall be deemed to be a
contract under the laws of the State of New York, and for all purposes shall be
construed in accordance with the laws of such state, except as may otherwise be
required by mandatory provisions of law.
Capitalized terms used herein which are not otherwise defined
shall have the respective meanings assigned to them in the Indenture and all
indentures supplemental thereto relating to this security.
A-7
<PAGE>
Exhibit B
---------
THIS NOTE IN IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE
HEREINAFTER REFERRED TO. UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"),
TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT AND
ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER
NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC AND ANY PAYMENT IS
MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC, ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
UNLESS AND UNTIL THIS CERTIFICATE IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN
CERTIFICATED FORM, THIS CERTIFICATE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY
DTC TO A NOMINEE THEREOF OR BY A NOMINEE THEREOF TO DTC OR ANOTHER NOMINEE OF
DTC OR BY DTC OR ANY SUCH NOMINEE TO A SUCCESSOR OF DTC OR A NOMINEE OF SUCH
SUCCESSOR.
REGISTERED REGISTERED
NO. [__________] PRINCIPAL AMOUNT
CUSIP NO. [__________] $100,000,000
LIBERTY PROPERTY LIMITED PARTNERSHIP
7.25% Senior Notes due 2007
Liberty Property Limited Partnership, a Pennsylvania limited
partnership (the "Issuer," which term includes any successor under the Indenture
hereinafter referred to), for value received, hereby promises to pay to Cede &
Co. or its registered assigns, the principal sum of One Hundred Million Dollars
on August 15, 2007 (the "Maturity Date"), and to pay interest thereon from
August 19, 1997 (or from the most recent interest payment date to which interest
has been paid or duly provided for), semi-annually in arrears on February 15 and
August 15 of each year (each, an "Interest Payment Date"), commencing on
February 15, 1997, and on the Maturity Date, at the rate of 7.25% per annum,
until payment of said principal sum has been made or duly provided for.
The interest so payable and punctually paid or duly provided
for on any Interest Payment Date and on the Maturity Date will be paid to the
Holder in whose name this Note (or
B-1
<PAGE>
one or more predecessor Notes) is registered at the close of business on the
"Record Date" for such payment, which will be 15 days (regardless of whether
such day is a Business Day (as defined below)) prior to such payment date or the
Maturity Date, as the case may be. Any interest not so punctually paid or duly
provided for shall forthwith cease to be payable to the Holder on such record
date, and shall be paid to the Holder in whose name this Note (or one or more
predecessor Notes) is registered at the close of business on a subsequent record
date for the payment of such defaulted interest (which shall be not more than 15
days and not less than 10 days prior to the date of the payment of such
defaulted interest) established by notice given by mail by or on behalf of the
Issuer to the Holders of the Notes not less than 10 days preceding such
subsequent record date. Interest on this Note will be computed on the basis of a
360-day year of twelve 30-day months.
The principal of this Note payable on the Maturity Date will
be paid against presentation and surrender of this Note at the corporate trust
office of the Trustee at One First National Plaza, Chicago, Illinois 60670-0126,
in such coin or currency of the United States of America as at the time of
payment is legal tender for payment of public or private debt.
Interest payable on this Note on any Interest Payment Date and
on the Maturity Date, as the case may be, will be the amount of interest accrued
from and including the immediately preceding Interest Payment Date (or from and
including August 19, 1997, in the case of the initial Interest Payment Date) to
but excluding the applicable Interest Payment Date or the Maturity Date, as the
case may be. If any Interest Payment Date or the Maturity Date falls on a day
that is not a Business Day (as defined below), the required payment of interest
or principal or both, as the case may be, will be made on the next Business Day
with the same force and effect as if it were made on the date such payment was
due and no interest will accrue on the amount so payable for the period from and
after such Interest Payment Date or the Maturity Date, as the case may be.
"Business Day" means any day, other than a Saturday or a Sunday, that is neither
a legal holiday nor a day on which banking institutions in The City of New York
or Chicago are authorized or required by law, regulation or executive order to
close.
Payments of principal and interest in respect of this Note
will be made by wire transfer of immediately available funds in such coin or
currency of the United States of America as at the time of payment is legal
tender for the payment of public and private debts.
Reference is made to the further provisions of this Note set
forth on the reverse hereof. Such further provisions shall for all purposes have
the same effect as though fully set forth at this place.
This Note shall not be entitled to the benefits of the
Indenture referred to on the reverse hereof or be valid or become obligatory for
any purpose until the certificate of authentication hereon shall have been
signed by the Trustee under such Indenture.
B-2
<PAGE>
IN WITNESS WHEREOF, the Issuer has caused this instrument to
be signed manually or by facsimile by its authorized officers.
Dated: August , 1997
LIBERTY PROPERTY LIMITED PARTNERSHIP,
as Issuer
By: LIBERTY PROPERTY TRUST,
as its sole General Partner
By:
---------------------------------------
Name:
Title:
By:
---------------------------------------
Name:
Title:
<PAGE>
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated herein
referred to in the within-mentioned Indenture.
THE FIRST NATIONAL BANK OF CHICAGO,
as Trustee
By:
----------------------------------
Authorized Officer
<PAGE>
[REVERSE OF NOTE]
LIBERTY PROPERTY LIMITED PARTNERSHIP
7.25% Senior Notes due 2007
This security is one of a duly authorized issue of debentures,
notes, bonds, or other evidences of indebtedness of the Issuer (hereinafter
called the "Securities") of the series hereinafter specified, all issued or to
be issued under and pursuant to an Indenture dated as of August 14, 1997 (herein
called the "Indenture"), duly executed and delivered by the Issuer to The First
National Bank of Chicago, as Trustee (herein called the "Trustee," which term
includes any successor trustee under the Indenture with respect to the series of
Securities of which this Note is a part), to which Indenture and all indentures
supplemental thereto relating to this security reference is hereby made for a
description of the rights, limitations of rights, obligations, duties, and
immunities thereunder of the Trustee, the Issuer, and the Holders of the
Securities, and of the terms upon which the Securities are, and are to be,
authenticated and delivered. The Securities may be issued in one or more series,
which different series may be issued in various aggregate principal amounts, may
mature at different times, may bear interest (if any) at different rates, may be
subject to different redemption provisions (if any), and may otherwise vary as
provided in the Indenture or any indenture supplemental thereto. This security
is one of a series designated as the 7.25% Notes due August 15, 2007 of the
Issuer, limited in aggregate principal amount to $100,000,000.
In case an Event of Default with respect to this security
shall have occurred and be continuing, the principal hereof and Make-Whole
Amount, if any, may be declared, and upon such declaration shall become, due and
payable, in the manner, with the effect, and subject to the conditions provided
in the Indenture.
The Issuer may redeem this security at any time at the option
of the Issuer, in whole or from time to time in part, at a redemption price
equal to the sum of (i) the principal amount of this security being redeemed
plus accrued interest thereon to the Redemption Date and (ii) the Make-Whole
Amount, if any, with respect to this security. Notice of any optional redemption
of any Securities will be given to Holders at their addresses, as shown in the
security register for the Securities, not more than 60 nor less than 30 days
prior to the date fixed for redemption. The notice of redemption will specify,
among other items, the Redemption Price and the principal amount of the
Securities held by such Holder to be redeemed.
The Indenture contains provisions permitting the Issuer and
the Trustee, with the consent of the Holders of not less than a majority of the
aggregate principal amount of the Securities at the time Outstanding of all
series to be affected (voting as one class), evidenced as provided in the
Indenture, to execute supplemental indentures adding any provisions to or
changing in any manner or eliminating any of the provisions of the Indenture or
of any supplemental indenture or modifying in any manner the rights of the
Holders of the Securities of each series; provided, however, that no such
supplemental indenture shall, without the consent of the Holder of each Security
so affected, (i) change the Stated Maturity of the principal of (or
B-5
<PAGE>
premium or Make-Whole Amount, if any, on) or any installment of interest on, any
such Security; (ii) or reduce the principal amount of, or the rate or amount of
interest on, or any premium payable on redemption of the Securities, or
adversely affect any right of repayment of the Holder of any Securities; (iii)
change the place of payment, or the coin or currency, for payment of principal
or premium, if any, or interest on the Securities; (iv) impair the right to
institute suit for the enforcement of any payment on or with respect to the
Securities on or after the stated maturity of any such Security; (v) reduce the
above-stated percentage in principal amount of outstanding Securities the
consent of whose Holders is necessary to modify or amend the Indenture, for any
waiver with respect to the Securities, or to waive compliance with certain
provisions of the Indenture or certain defaults and consequences thereunder or
to reduce the quorum or voting requirements set forth in the Indenture; or (vi)
modify any of the foregoing provisions or any of the provisions relating to the
waiver of certain past defaults or certain covenants, except to increase the
required percentage to effect such action or to provide that certain other
provisions of the Indenture may not be modified or waived without the consent of
the Holder of each Security. It is also provided in the Indenture that, with
respect to certain defaults or Events of Default regarding the Securities of any
series, the Holders of a majority in aggregate principal amount outstanding of
the Securities of such series (or, in the case of certain defaults or Events of
Default, all series of Securities) may on behalf of the Holders of all the
Securities of such series (or all of the Securities, as the case may be) waive
any such past default or Event of Default and its consequences, prior to any
declaration accelerating the maturity of such Securities, or, subject to certain
conditions, may rescind a declaration of acceleration and its consequences with
respect to such Securities. Any such consent or waiver by the Holder of this
Security (unless revoked as provided in the Indenture) shall be conclusive and
binding upon such Holder and upon all future Holders and owners of this Security
and any Securities that may be issued in exchange or substitution herefor,
irrespective of whether or not any notation thereof is made upon this security
or such other securities.
No reference herein to the Indenture and no provision of this
security or of the Indenture shall alter or impair the obligation of the Issuer,
which is absolute and unconditional, to pay the principal of and any Make-Whole
Amount and interest on this security in the manner, at the respective times, at
the rate and in the coin or currency herein prescribed.
This security is issuable only in registered form without
coupons in denominations of $1,000 and integral multiples thereof. Securities
may be exchanged for a like aggregate principal amount of securities of this
series of other authorized denominations at the office or agency of the Issuer
in The Borough of Manhattan, The City of New York, in the manner and subject to
the limitations provided in the Indenture, but without the payment of any
service charge except for any tax or other governmental charge imposed in
connection therewith.
Upon due presentment for registration of transfer of
Securities at the office or agency of the Issuer in The Borough of Manhattan,
The City of New York, one or more new Securities of the same series of
authorized denominations in an equal aggregate principal amount will be issued
to the transferee in exchange therefor, subject to the limitations provided in
the Indenture, without charge except for any tax or other governmental charge
imposed in connection therewith.
The Issuer, the Trustee or any authorized agent of the Issuer
or the Trustee may deem and treat the Person in whose name this security is
registered as the absolute owner of this security (whether or not this security
shall be overdue and notwithstanding any notation of ownership or other writing
hereon), for the purpose of receiving payment of, or on account of,
B-6
<PAGE>
the principal hereof and Make-Whole Amount, if any, and subject to the
provisions on the face hereof, interest hereon, and for all other purposes, and
neither the Issuer nor the Trustee nor any authorized agent of the Issuer or the
Trustee shall be affected by any notice to the contrary.
The Indenture and each Security shall be deemed to be a
contract under the laws of the State of New York, and for all purposes shall be
construed in accordance with the laws of such state, except as may otherwise be
required by mandatory provisions of law.
Capitalized terms used herein which are not otherwise defined
shall have the respective meanings assigned to them in the Indenture and all
indentures supplemental thereto relating to this security.
B-7
