SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
Current Report Pursuant to Section 13 or 15(d) of
The Securities Act of 1934
Date of Report (Date of earliest event reported):
March 24, 1998
HOME PROPERTIES OF NEW YORK, INC.
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(Exact name of registrant as specified in its charter)
Delaware 1-13136 16-1455126
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(State or other
jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
850 Clinton Square, Rochester, New York 14604
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (716)246-4150
Not Applicable
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(Former name or former address, if changed since last report.)
<PAGE>
ITEM 5. OTHER EVENTS
On March 24, 1998, Home Properties of New York, Inc. ("Home Properties"
or "Registrant") entered into an underwriting agreement with Wheat First
Securities, Inc. (the "Underwriter") pursuant to which the Underwriter will
purchase 384,615 shares of the common stock, par value $.01, of Home Properties
(the "Common Stock") at a price per share of $24.70, resulting in aggregate
proceeds to Home Properties of $9,499,990.50 before expenses payable by Home
Properties which are estimated to be $20,000. The Underwriter has informed Home
Properties that it plans to sell the Common Stock to Van Kampen American Capital
for an aggregate price of $9,599,990.40. Van Kampen American Capital intends to
deposit the Common Stock, with the common stock of other entities, into the
Wheat First Union REIT Income & Growth Trust, Series 1.
In addition, the State Treasurer of the State of Michigan, as custodian
for various public employee retirement funds (the "Michigan Retirement System")
has agreed to purchase 39,650 shares at a price of $25.22 per share, resulting
in aggregate proceeds to the Company of $999,973, less any applicable expenses.
The purchase by the Michigan Retirement System is pursuant to the terms of the
purchase right set forth in the Partnership Interest Purchase Agreement, dated
December 23, 1996, between the Company, the Operating Partnership and the
Michigan Retirement System.
On March 25, 1998, Home Properties filed with the Securities and
Exchange Commission a Prospectus Supplement, dated March 24, 1998, with respect
to the transaction described above, supplementing the Home Properties
Prospectus, dated February 24, 1997, which forms a portion of Home Properties
Registration Statement on Form S-3 (No. 333-02674) covering the Common Stock.
This Report on Form 8-K contains the Underwriting Agreement with the Underwriter
as an exhibit to such Registration Statement.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
a. Financial Statements of Businesses Acquired.
None
b. Pro Forma Financial Information.
None.
c. Exhibits
99 Additional Exhibits
.1 Underwriting Agreement, dated March 24, 1998, between
Home Properties of New York, Inc. and Wheat First Securities,
Inc.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the Registrant has duly caused this report to be signed on its behalf by
the undersigned thereunto duly authorized.
Dated: March 25, 1998
Home Properties of New York, Inc.
By: /s/ Ann M. McCormick
-------------------------------------
Vice President
384,615 Shares
HOME PROPERTIES OF NEW YORK, INC.
Common Stock
UNDERWRITING AGREEMENT
March 24, 1998
Wheat First Securities, Inc.
Riverfront Plaza
901 East Byrd Street
Richmond, Virginia 23219
Ladies and Gentlemen:
Home Properties of New York, Inc., a Maryland corporation (the
"Company"), proposes to issue and sell 384,615 shares of common stock of the
Company, par value $.01 per share (the "Shares"), to Wheat First Securities,
Inc. (you or the "Underwriter"). The shares of common stock, par value $.01 per
share, of the Company to be outstanding after giving effect to the sale
contemplated hereby are hereinafter referred to as shares of the "Common Stock."
1. REGISTRATION STATEMENT AND PROSPECTUS. The Company has prepared and
filed with the Securities and Exchange Commission (the "Commission") in
accordance with the provisions of the Securities Act of 1933, as amended, and
the rules and regulations of the Commission thereunder (collectively called the
"Act"), a registration statement on Form S-3 (Registration No. 333-2674)
including a prospectus relating to the registration of the Shares and such other
securities which may be offered from time to time by the Company in accordance
with Rule 415 under the Act. Such registration statement (as amended, if
applicable) has been declared effective by the Commission on February 28, 1997.
Such registration statement (as amended, if applicable), on the one hand, and
the prospectus constituting a part thereof and the prospectus supplement
relating to the offering of the Shares provided to the Underwriter by the
Company for use (whether or not such prospectus supplement is required to be
filed with the Commission by the Company pursuant to the Act) (the "Prospectus
Supplement"), on the other hand, including all documents incorporated therein by
reference, as from time to time amended or supplemented pursuant to the
Securities Exchange Act of 1934, as amended, and the rules and regulations of
the Commission thereunder (collectively called the "Exchange Act") and the Act
are referred to herein as the "Registration Statement" and the "Prospectus,"
respectively; provided, however, that a prospectus supplement shall be deemed to
have supplemented the Prospectus only with respect to the offering of the Shares
to which it relates. Any registration statement (including any amendment or
supplement thereto or information which is deemed part thereof) filed by the
Company under Rule 462(b) of the Act (a "Rule 462(b) Registration Statement")
shall be deemed to be part of the "Registration Statement" as defined herein and
any prospectus or any term sheet as contemplated by Rule 434 of the Act (a "Term
Sheet") (including any amendment or supplement thereto or information which is
deemed part thereof) included in such registration statement shall be deemed to
be part of the "Prospectus," as defined herein. All references in this Agreement
to financial statements and schedules and other information which is
"contained," "included," "described" or "stated" in the Registration Statement
or the Prospectus (and all other references of like import) shall be deemed to
mean and include all such financial statements and schedules and other
information which is or is deemed to be incorporated by reference in the
Registration Statement or Prospectus, as the case may be; and all references in
this Agreement to amendments or supplements to the Registration Statement or the
Prospectus shall be deemed to mean and include, without limitation, even though
not specifically stated, any document filed under the Exchange Act which is or
is deemed to be incorporated by reference in the Registration Statement or the
Prospectus, as the case may be. Capitalized terms used but not otherwise defined
herein shall have the meanings given to those terms in the Prospectus.
2. AGREEMENTS TO SELL AND PURCHASE. On the basis of the representations and
warranties contained in this Agreement, and subject to its terms and conditions,
the Company agrees to issue and sell the Shares and the Underwriter agrees to
purchase the Shares from the Company at a price per share of $24.70 (the
"Purchase Price").
3. TERMS OF THE OFFERING. The Company is advised by the Underwriter that it
propose to sell the Shares (the "Offering") to Van Kampen American Capital which
intends to deposit the Shares, together with the common stock of other entitiies
purchased from the Underwriter, directly with the Trustee of the Wheat First
Union REIT Income & Growth Trust, Series 1 (the "Trust"), a registered unit
investment trust under the Investment Company Act of 1940, as amended, as soon
after the execution and delivery hereof as in its judgment is advisable.
4. DELIVERY AND PAYMENT. Delivery to the Underwriter of certificates for,
and payment of the Purchase Price for the Shares shall be made, subject to
Section 9, at 10:00 A.M., New York City time, on March 27, 1998, or such other
time not later than ten business days after such date as shall be agreed upon by
the Underwriter and the Company (such time and date of payment and delivery
being herein called the "Closing Date") at such place as you shall designate.
The Closing Date and the location of, delivery of and the form of payment for
the Shares may be varied by agreement between you and the Company.
Certificates for the Shares shall be registered in such names and issued in
such denominations as you shall request in writing not later than two full
business days prior to the Closing Date. Such certificates shall be made
available to you for inspection not later than 9:30 A.M., New York City time, on
the business day next preceding the Closing Date. Certificates in definitive
form evidencing the Shares shall be delivered to you on the Closing Date, with
any transfer taxes thereon duly paid by the Company, for the account of the
Underwriter, against payment of the Purchase Price therefor by intra-bank
transfer or wire transfer of same day funds to such account as may be designated
by the Company at least two business days prior to the Closing Date.
5. AGREEMENTS OF THE TRANSACTION ENTITIES. The Company and the Operating
Partnership (collectively, the "Transaction Entities") jointly and severally
agree with you as follows:
(a) In respect of the offering of Shares, the Company will (i) prepare a
Prospectus Supplement setting forth the number of Shares covered thereby and
their terms not otherwise specified in the Prospectus pursuant to which the
Shares are being issued, the name of the Underwriter and the number of Shares
which the Underwriter has agreed to purchase, the price at which the Shares are
to be purchased by the Underwriter from the Company, the initial offering price,
and such other information as the Underwriter and the Company deem appropriate
in connection with the offering of the Shares, and (ii) file the Prospectus in a
form approved by you pursuant to Rule 424(b) under the Act no later than the
Commission's close of business on the second business day following the date of
the determination of the offering price of the Shares The Company will furnish
to the Underwriter and to such dealers as you shall specify as many copies of
the Prospectus as the Underwriter shall reasonably request for the purposes
contemplated by the Act or the Exchange Act.
(b) At any time when the Prospectus is required to be delivered under the
Act or the Exchange Act in connection with sales of Shares, the Transaction
Entities will advise you promptly and, if requested by you, confirm such advice
in writing, of (i) the effectiveness of any amendment to the Registration
Statement, (ii) the transmittal to the Commission for filing of any Prospectus
or other supplement or amendment to the Prospectus to be filed pursuant to the
Act, (iii) the receipt of any comments from the Commission relating to the
Registration Statement, any preliminary prospectus, the Prospectus or any of the
transactions contemplated by this Agreement, (iv) any request by the Commission
for post-effective amendments to the Registration Statement or amendments or
supplements to the Prospectus or for additional information, (v) the issuance by
the Commission of any stop order suspending the effectiveness of the
Registration Statement or of the suspension of qualification of the Shares for
offering or sale in any jurisdiction, or the initiation of any proceeding for
such purposes, and (vi) the happening of any event 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 when the Prospectus is
delivered to a purchaser, not misleading. Each of the Transaction Entities will
make every reasonable effort to prevent the issuance of any stop order, and if
at any time the Commission shall issue any stop order suspending the
effectiveness of the Registration Statement, each of the Transaction Entities
will make every reasonable effort to obtain the withdrawal or lifting of such
order at the earliest possible time.
(c) [Intentionally omitted]
(d) At any time when the Prospectus is required to be delivered under the
Act or the Exchange Act in connection with sales of Shares, the Transaction
Entities will not file any amendment to the Registration Statement or any Rule
462(b) Registration Statement or make any amendment or supplement to the
Prospectus or any Term Sheet, if applicable, of which you shall not previously
have been advised or to which you or your counsel shall reasonably object; and
the Company will prepare and file with the Commission, promptly upon your
reasonable request, any amendment to the Registration Statement, Rule 462(b)
Registration Statement, Term Sheet, or amendment or supplement to the Prospectus
which, in the opinion of your counsel, may be necessary in connection with the
distribution of the Shares by you, and will use its best efforts to cause the
same to become promptly effective. If applicable, the Prospectus and any
amendments or supplements thereto furnished to the Underwriter 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.
(e) If, at any time when the Prospectus is required to be delivered under
the Act or the Exchange Act in connection with sales of Shares, any event shall
occur as a result of which, in the opinion of counsel for the Underwriter, it
becomes necessary to amend or supplement the Prospectus in order to make the
statements therein, in the light of the circumstances existing when the
Prospectus is delivered to a purchaser, not misleading, or if it is necessary to
amend or supplement the Prospectus to comply with any law, the Company will
forthwith prepare and file with the Commission an appropriate amendment or
supplement to the Prospectus or an appropriate filing under the Exchange Act
which shall be incorporated by reference in the Prospectus (in form and
substance reasonably satisfactory to counsel for the Underwriter) so that the
statements in the Prospectus, as so amended or supplemented, will not contain an
untrue statement of a material fact or omit to state a material fact necessary
in order to make the statements therein, in the light of the circumstances
existing when it is so delivered, not misleading, or so that the Prospectus will
comply with any law, and to furnish to the Underwriter and to such dealers as
you shall specify, such number of copies thereof as the Underwriter or dealers
may reasonably request.
(f) Each of the Transaction Entities will use its reasonable business
efforts, in cooperation with the Underwriter, to qualify, register or perfect
exemptions for the Shares for offer and sale by the Underwriter under the
applicable state securities or Blue Sky laws and real estate syndication laws of
such jurisdictions as you may reasonably request; provided, however, none of the
Transaction Entities will be required to qualify as a foreign corporation, file
a general consent to service of process in any such jurisdiction, subject itself
to taxation in respect of doing business in any jurisdiction in which it is not
otherwise so subject, or provide any undertaking or make any change in its
charter or by-laws that the Board of Directors of the Company reasonably
determines to be contrary to the best interests of the Company and its
stockholders. In each jurisdiction in which the Shares have been so qualified or
registered, the Transaction Entities will use all reasonable efforts to file
such statements, reports and other documents as may be required by the laws of
such jurisdiction, to continue such qualification or registration in effect for
so long a period as the Underwriter may reasonably request for the distribution
of the Shares.
(g) To make generally available to the Company's stockholders as soon as
reasonably practicable but not later than sixty (60) days after the close of the
period covered thereby (ninety (90) days in the event the close of such period
is the close of the Company's fiscal year), an earnings statement (in form
complying with the provisions of Rule 158 of the Act) covering a period of at
least twelve months after the effective date of the Registration Statement (but
in no event commencing later than ninety (90) days after such date) which shall
satisfy the provisions of Section 11(a) of the Act, and, if required by Rule 158
of the Act, to file such statement as an exhibit to the next periodic report
required to be filed by the Company under the Exchange Act covering the period
when such earnings statement is released.
(h) [Intentionally omitted]
(i) During the period when the Prospectus is required to be delivered under
the Act or the Exchange Act in connection with sales of the Shares, to file all
documents required to be filed by it with the Commission pursuant to Section 13,
14 or 15 of the Exchange Act within the time periods required by the Exchange
Act.
(j) To pay all costs, expenses, fees and taxes incident to (i) the
preparation, printing, filing and distribution under the Act of the Registration
Statement and any amendment thereto (including financial statements and
exhibits), each preliminary prospectus, the Prospectus and all amendments and
supplements to any of them prior to or during the period specified in Section
5(b), (ii) the printing and delivery of this Agreement, (iii) the qualification
of registration of the Shares for offer and sale under the securities, or real
estate syndication laws of the several states in accordance with Section 5(f)
hereof, (iv) the fee of and the listing of the Shares on the New York Stock
Exchange, Inc. ("NYSE"), (v) furnishing such copies of the Registration
Statement, the Prospectus and all amendments and supplements thereto as may be
requested for use in connection with the offering or sale of the Shares by the
Underwriter, (vi) the preparation, issuance and delivery of certificates for the
Shares to the Underwriter, (vii) the costs and charges of any transfer agent or
registrar, (viii) any transfer taxes imposed on the sale by the Company of the
Shares to the Underwriter and (ix) the fees and disbursements of the Company's
counsel and accountants.
(k) The Transaction Entities will use their best efforts to maintain the
listing of the Shares on the NYSE for a period of three years after the Closing
Date and thereafter unless the Company's Board of Directors determines that it
is no longer in the best interests of the Company for the Shares to continue to
be so listed.
(l) The Transaction Entities will use their best efforts to do and perform
all things required to be done and performed under this Agreement by the
Transaction Entities prior to the Closing Date and to satisfy all conditions
precedent to the delivery of the Shares.
(m) The Company will use the net proceeds received by it from the sale of
the Shares in the manner specified in the Prospectus Supplement under "Use of
Proceeds."
(n) The Company will prepare and file or transmit for filing with the
Commission in accordance with Rule 424(b) of the Act copies of the Prospectus.
(o) The Transaction Entities will use their reasonable business efforts to
ensure that the Company continues to qualify as a "real estate investment trust"
("REIT") under Sections 856 through 860 of the Internal Revenue Code of 1986, as
amended (the "Code"), for a period of three years after the date of this
Agreement unless the Company's Board of Directors determines that it is no
longer in the best interest of the Company to be so qualified.
(p) The Transaction Entities will not at any time, directly or indirectly,
take any action intended, or which might reasonably be expected, to cause or
result in, or which will constitute, stabilization of the price of the Shares to
facilitate the sale or resale of any Shares in violation of the Act.
6. REPRESENTATIONS AND WARRANTIES OF THE TRANSACTION ENTITIES. Each of the
Transaction Entities jointly and severally represents and warrants to the
Underwriter as of the date hereof and the Closing Date that:
(a) The Registration Statement became effective on February 28, 1997. 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 the Transaction Entities, threatened by the
Commission or by the state securities authority of any jurisdiction. No order
preventing or suspending the use of the Prospectus has been issued and no
proceeding for that purpose has been instituted or, to the knowledge of the
Transaction Entities, threatened by the Commission or by the state securities
authority of any jurisdiction.
(b) The Registration Statement and the Prospectus, including the financial
statements, schedules and related notes included in the Prospectus or
incorporated therein by reference and, if applicable, any Term Sheet to the
Prospectus, as of the date hereof and at the time the Registration Statement
became effective, and when any post-effective amendment to the Registration
Statement or Rule 462(b) Registration Statement becomes effective or any
amendment or supplement to the Prospectus is filed with the Commission, did or
will comply in all material respects with all applicable provisions of the Act
and will contain all statements required to be stated therein in accordance with
the Act. The Prospectus, including the financial statements, schedules and
related notes included in the Prospectus or incorporated therein by reference,
and if applicable, any Term Sheet to the Prospectus, as of the date hereof and
at the time the Registration Statement became effective, and at the Closing
Date, and when any post-effective amendment to the Registration Statement or
Rule 462(b) Registration Statement becomes effective or any amendment or
supplement to the Prospectus is filed with the Commission, did or will comply in
all material respects with all applicable provisions of the Act. On the date the
Registration Statement was declared effective, on the date hereof, on the date
of filing of any Rule 462(b) Registration Statement and on the Closing Date, no
part of the Registration Statement or any amendment did or will contain an
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary in order to make the statements therein not
misleading. On the date the Registration Statement was declared effective, on
the date hereof, as of its date, on the date of filing of any Rule 462(b)
Registration Statement and at the Closing Date, the Prospectus and the
Prospectus Supplement did not or will not contain any untrue statement of a
material fact or omit to state a material fact necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading. If a Rule 462(b) Registration Statement is filed in connection with
the offering and sale of the Shares, the Company will have complied or will
comply with the requirements of Rule 111 under the Act relating to the payment
of filing fees therefor. The foregoing representations and warranties in this
Section 6(b) do not apply to any statements or omissions made in reliance on and
in conformity with information relating to the Underwriter furnished in writing
to the Company by the Underwriter specifically for inclusion in the Registration
Statement or Prospectus or any amendment or supplement thereto. The Transaction
Entities have not distributed any offering material in connection with the
offering or sale of the Shares other than the Registration Statement, the
Prospectus or any other materials, if any, permitted by the Act (which were
disclosed to the Underwriter and Underwriter's counsel).
(c) Each 462(b) Registration Statement, if any, complied or will comply
when so filed in all material respects with all applicable provisions of the
Act; did not or will not contain an untrue statement of a material fact or omit
to state a material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading; and the Prospectus delivered to the Underwriter for use in
connection with the offering of the Shares will, at the time of such delivery,
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) The documents incorporated or deemed to be incorporated by reference in
the Prospectus pursuant to Item 12 of Form S-3 under the Act, at the time they
were, or hereafter are, filed with the Commission, complied and will comply in
all material respects with the requirements of the Exchange Act, and, when read
together with other information in and incorporated by reference in the
Prospectus, at the time the Registration Statement became effective, and as of
the Closing Date, or during the period specified in Section 5(b) did not and
will not include an untrue statement of a material fact or omit to state a
material fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading. The foregoing
representations and warranties in this Section 6(d) do not apply to any
statements or omissions made in reliance on and in conformity with information
relating to the Underwriter furnished in writing to the Company by the
Underwriter specifically for inclusion in the Registration Statement or
Prospectus or any amendment or supplement thereto.
(e) The historical financial statements and the related notes thereto,
included or incorporated by reference in the Registration Statement and the
Prospectus, comply in all material respects with the requirements of the Act and
the Exchange Act, as applicable, and present fairly the consolidated financial
position of the Transaction Entities and their consolidated subsidiaries as of
the dates indicated and the results of their operations and the changes in their
cash flows for the periods specified; the financial statements with respect to
[the Properties (as defined in the Prospectus) acquired by the Transaction
Entities], together with related notes, incorporated by reference in the
Registration Statement or the Prospectus, present fairly a summary of gross
income and direct operating expenses or a summary of gross income, as the case
may be, of such Properties for the indicated periods; the foregoing financial
statements have been prepared in conformity with generally accepted accounting
principles applied on a consistent basis, and the supporting schedules included
or incorporated by reference in the Registration Statement present fairly the
information required to be stated therein; the pro forma financial information,
and the related notes thereto, included or incorporated by reference in the
Registration Statement and the Prospectus comply in all material respects with
the applicable requirements of the Act and the Exchange Act, as applicable; the
assumptions used in preparing such pro forma information are reasonable and the
adjustments used therein are appropriate to give effect to the transactions
referred to therein; and the other financial and statistical information and
data set forth in the Registration Statement and the Prospectus are accurately
presented in all material respects and prepared on a basis consistent with the
books and records of the Transaction Entities and their consolidated
subsidiaries.
(f) Since the respective dates as of which information is given in the
Registration Statement and the Prospectus, (i) there has not been any material
adverse change, or any development involving a prospective material adverse
change, in or affecting the condition (financial or otherwise), business,
prospects, properties, net worth or results of operations of the Transaction
Entities and their subsidiaries, taken as a whole, otherwise than as set forth
or contemplated in the Prospectus; and (ii) except as set forth or contemplated
in the Prospectus, neither the Transaction Entities nor any of their
subsidiaries has entered into any transaction or agreement (whether or not in
the ordinary course of business) material to the Transaction Entities and their,
taken as a whole.
(g) The Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of Maryland, with
corporate power and authority to own or lease its properties and to conduct its
business as described in the Prospectus, and is duly qualified as a foreign
corporation for the transaction of business and is in good standing under the
laws of each other jurisdiction in which it owns or leases properties, or
conducts any business, so as to require such qualification, other than where the
failure to be so qualified or in good standing would not (1) have a material
adverse effect on the condition (financial or otherwise), business, properties,
net worth or results of operations of the Transaction Entities and their
subsidiaries, taken as a whole, (2) adversely affect the issuance or validity of
the Shares or (3) materially adversely affect the consummation of any of the
transactions contemplated by this Agreement (each of (1), (2) and (3) above, a
"Material Adverse Effect". Except for investments in their subsidiaries, in
short-term investment securities and in other securities as described in the
Registration Statement or Prospectus, the Company has no direct or indirect
equity or other interest in any corporation, partnership, trust or other entity;
each of the subsidiaries whose operations are consolidated with those of the
Company for financial reporting purposes (the "Subsidiaries") of the Transaction
Entities is defined on SCHEDULE I hereto and has been duly organized and is
validly existing as a corporation, trust or limited partnership, as the case may
be, in good standing under the laws of its jurisdiction of organization with
corporate, trust or partnership power and authority, as the case may be, to own
or lease its properties and conduct its business as presently conducted and as
described in the Prospectus, and has been duly qualified as a foreign
corporation or foreign limited partnership, as the case may be, for the
transaction of business and is in good standing under the laws of each other
jurisdiction in which it owns or leases properties, or conducts any business, so
as to require such qualification, other than where the failure to be so
qualified or in good standing would not have a Material Adverse Effect; all the
outstanding shares of capital stock of each Subsidiary have been duly authorized
and validly issued and are fully paid and nonassessable; except as disclosed in
SCHEDULE I hereto, all the outstanding shares of capital stock and all
partnership interests of each Subsidiary are owned by the Transaction Entities,
directly or indirectly, free and clear of all liens, encumbrances, security
interests and claims.
(h) The Operating Partnership has been duly formed and is validly existing
as a limited partnership in good standing under the laws of the State of New
York, is duly qualified to do business 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 except where the failure to be so qualified
would not have a Material Adverse Effect, 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 General Partner is the sole general partner of the Operating
Partnership. The Second 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 its qualified REIT subsidiary, Home Properties Trust, a Maryland real estate
trust, in the Operating Partnership are as set forth in the Prospectus.
(i) [Intentionally omitted]
(j) This Agreement has been duly authorized, executed and delivered by the
Transaction Entities.
(k) The Shares have been duly authorized and, when issued and delivered to
the Underwriter against payment therefor in accordance with the terms hereof,
will be validly issued, fully paid and nonassessable. Application has been made
to list the Shares on the NYSE. The form of certificate for the Shares will
comply with all applicable legal and NYSE requirements. The holders of
outstanding shares of capital stock of the Company are not entitled to
preemptive or other rights to subscribe for the Shares. The capital stock of the
Company conforms to the description thereof in the Registration Statement and
the Prospectus.
(l) Neither the Transaction Entities nor any of their Subsidiaries is, or
with the giving of notice or lapse of time or both would be, in violation of or
in default under (1) its Articles of Incorporation, Certificate of Incorporation
or partnership agreement, as the case may be (in each case as amended to the
date of this Agreement), (2) its Bylaws (as amended to the date of this
Agreement), if any, or (3) any indenture, mortgage, deed of trust, loan
agreement, partnership agreement or other agreement or instrument or obligation
to which such Transaction Entity or any of it subsidiaries is a party or by
which it or any of its properties is bound, except, with respect to clauses (2)
and (3), for violations and defaults which individually or in the aggregate
would not have a Material Adverse Effect; the issue and sale of the Shares and
the performance by each of the Transaction Entities of all of the obligations
under this Agreement and the consummation of the transactions herein
contemplated will not conflict with or result in a breach of any of the terms or
provisions of, or constitute a default under, any indenture, mortgage, deed of
trust, loan agreement, partnership agreement or other material agreement or
instrument to which any of the Transaction Entities or any of its Subsidiaries
is a party or by which any of the Transaction Entities or of its Subsidiaries is
bound or to which any of the property or assets of the Transaction Entities or
any of its Subsidiaries is subject, except for such conflicts, breaches,
defaults or violations which individually or in the aggregate would not have a
Material Adverse Effect, nor will any such action result in any violation of the
provisions of the Amended and Restated Articles of Incorporation or the ByLaws
of the Company or any applicable law or statute or any order, rule or regulation
of any court or governmental agency or body having jurisdiction over any of the
Transaction Entities or any of their properties, except for such violations
which individually or in the aggregate would not have a Material Adverse Effect;
and no consent, approval, authorization, order, registration or qualification of
or with any such court or governmental agency or body is required for the issue
and sale of the Shares or the consummation by the Transaction Entities of the
transactions contemplated by this Agreement, except such consents, approvals,
authorizations, orders, registrations or qualifications (x) as have been
obtained under the Act and the Exchange Act, (y) as may be required under state
securities or Blue Sky laws or Sections 2710 and 2720 of the Conduct Rules of
the NASD in connection with the purchase and distribution of the Shares by the
Underwriter or any other law, rule or regulation applicable to the Underwriter,
or (z) the failure to obtain which would not have a Material Adverse Effect.
(m) Other than as set forth or contemplated in the Prospectus, there are no
legal or governmental proceedings pending or, to the knowledge of any of the
Transaction Entities, threatened to which any of the Transaction Entities or
their Subsidiaries is or may be a party or to which any Properties of any of the
Transaction Entities or their Subsidiaries is or may be the subject which, if
determined adversely to the Transaction Entities, could individually or in the
aggregate reasonably be expected to have a Material Adverse Effect; there are no
contracts or other documents of a character required to be filed as an exhibit
to the Registration Statement or required to be described in the Registration
Statement or the Prospectus which are not filed or described as required; and
the descriptions of the terms of all such contracts and documents contained or
incorporated by reference in the Registration Statement or Prospectus are
complete and correct in all material respects.
(n) The authorized capital stock of the Company consists of 30 million
shares of Common Stock, $.01 par value per share, 10 million shares of excess
stock, par value $.10 per share, and 10 million shares of preferred stock, $.01
par value per share. The Company is seeking shareholder approval at its 1998
Annual Meeting of Shareholders to amend its Articles of Amendment and
Restatement of Articles of Incorporation to increase the number of authorized
shares of common stock to an aggregate of 50 million shares. All of the issued
shares of capital stock of the Company have been duly and validly authorized and
issued and are fully paid and nonassessable.
(o) One of the Transaction Entities or their Subsidiaries has good and
marketable title to each property described as owned by one of the Transaction
Entities or their Subsidiaries (the "Properties"), in each case free of any
lien, mortgage, pledge, charge or encumbrance of any kind except those (i)
described in the Prospectus or (ii) which do not materially affect or detract
from the value of such Properties or interfere with the use made and proposed to
be made of such Properties by the Transaction Entities and their Subsidiaries
and which individually and in the aggregate are in an amount which is not
material to the Transaction Entities.
(p) [Intentionally omitted]
(q) The mortgages and deeds of trust encumbering the Properties are not (i)
cross-defaulted to any indebtedness other than indebtedness of the Transaction
Entities or any of their Subsidiaries or (ii) cross-collateralized to any
property not owned by any of the Transaction Entities or their Subsidiaries.
(r) Each of the Transaction Entities and their Subsidiaries are insured by
insurers of recognized financial responsibility against such losses and risks
and in such amounts as are customary in the business in which they are engaged
and such insurance is adequate for the value of their properties; all policies
of insurance insuring the Transaction Entities or their subsidiaries or their
respective businesses, assets, employees, officers, trustees and directors, as
the case may be, are in full force and effect; each of the Transaction Entities
and their Subsidiaries is in compliance with the terms of such policies in all
material respects and there are no claims by any of the Transaction Entities or
by their subsidiaries under any such policy as to which any insurance company is
denying liability or defending under a reservation of rights clause, other than
claims which individually or in the aggregate would not have a Material Adverse
Effect.
(s) Each of the Transaction Entities has filed all federal, state and
foreign income tax returns which have been required to be filed except where the
failure to so file will not have a Material Adverse Effect, and have paid all
taxes indicated by said returns and all assessments received by it to the extent
that such taxes have become due and are not being contested in good faith.
(t) Each of the Transaction Entities and each of their Subsidiaries owns,
possesses and has obtained all material licenses, permits, certificates,
consents, orders, approvals and other authorizations from, and has made all
material declarations and filings with, all federal, state, local and other
governmental authorities, all self-regulatory organizations and all courts and
other tribunals necessary to own or lease, as the case may be, and to operate
its properties and to carry on its business as conducted as of the date hereof,
except in each case where the failure to obtain licenses, permits, certificates,
consents, orders, approvals and other authorizations, or to make all
declarations and filings, would not have a Material Adverse Effect, and none of
the Transaction Entities or any of its Subsidiaries has received any notice of
any proceeding relating to revocation or modification of any such license,
permit, certificate, consent, order, approval or other authorization, except as
described in the Prospectus and except, in each case, where such revocation or
modification would not have a Material Adverse Effect; and the Transaction
Entities and each of their Subsidiaries are in compliance with all laws, rules
and regulations relating to the conduct of their respective businesses as
conducted as of the date hereof, except where noncompliance with such laws,
rules or regulations would not have a Material Adverse Effect.
(u) To the knowledge of the Transaction Entities, their independent
accountants who have certified certain of the financial statements filed with
the Commission as part of, or incorporated by reference in, the Registration
Statement or the Prospectus, are independent public accountants as required by
the Act.
(v) To the knowledge of the Transaction Entities, no relationship, direct
or indirect, exists between or among any of the Transaction Entities or their
Subsidiaries on the one hand, and the directors, trustees, officers,
stockholders, customers or suppliers of any of the Transaction Entities or their
subsidiaries on the other hand, which is required by the Act to be described in
the Registration Statement and the Prospectus which is not so described.
(w) Each of the Transaction Entities has never been, is not now, and
immediately after giving effect to the sale of the Shares under this Agreement
will not be, an "investment company" or entity "controlled" by an "investment
company," within the meaning of the Investment Company Act of 1940, as amended
(the "Investment Company Act").
(x) With respect to all tax periods regarding which the Internal Revenue
Service is or will be entitled to assert any claim against any of the
Transaction Entities, the Company has met the requirements for qualification as
a REIT under Sections 856 through 860 of the Code, and the present and
contemplated operations, assets and income of the Transaction Entities and their
Subsidiaries, taken as a whole, continue to meet such requirements.
(y) The conditions for the use by the Company of a registration statement
on Form S-3 set forth in the General Instructions to Form S-3 have been
satisfied and the Company is entitled to use such form for the transactions
contemplated herein.
(z) Other than as disclosed in the Prospectus, the Transaction Entities
have no knowledge of (a) the unlawful presence of any hazardous substances,
hazardous materials, toxic substances or waste materials (collectively,
"Hazardous Materials") on any of the Properties or (b) any unlawful spills,
releases, discharges or disposals of Hazardous Materials that have occurred or
are presently occurring on or from the Properties, which presence or occurrence
would individually or in the aggregate have a Material Adverse Effect.
(aa) Other than as disclosed in the Prospectus, the Transaction Entities
and their Subsidiaries (i) are in compliance with any and all applicable
federal, state and local laws and regulations relating to the protection of
human health and safety, the environment or hazardous or toxic substances or
wastes, pollutants or contaminants ("Environmental Laws"), (ii) each Transaction
Entity has received all permits, licenses or other approvals required of them
under applicable Environmental Laws to conduct their respective businesses and
(iii) are in compliance with all terms and conditions of any such permit,
license or approval, except where such noncompliance with Environmental Laws,
failure to receive required permits, licenses or other approvals or failure to
comply with the terms and conditions of such permits, licenses or approvals
would not individually or in the aggregate have a Material Adverse Effect.
(bb) In the ordinary course of business, in connection with the acquisition
of various apartment communities the Transaction Entities engage environmental
consultants to conduct "Phase I" reviews of the communities or review reports
relating to prior Phase I reviews conducted on behalf of the previous owners of
such apartment communities to identify apparent risks under the Environmental
Laws within the scope of such reviews and to the extent set forth in the various
reports with respect thereto. On the basis of such reviews and other than as
described in the Prospectus, the Transaction Entities have reasonably concluded
that the associated costs and liabilities in connection with compliance with
applicable Environmental Laws would not, individually or in the aggregate, have
a Material Adverse Effect.
(cc) Subsequent to the respective dates as of which information is given in
the Prospectus, (i) the Company has not purchased any of its outstanding shares
of capital stock, or declared, paid or otherwise made any dividend or
distribution of any kind on its shares of capital stock other than regular
periodic dividends on such shares; and (ii) there has not been any material
change in the shares of capital stock of the Company or any material change in
the short-term debt or long-term debt of the Transaction Entities and their
subsidiaries on a consolidated basis, except as described in or contemplated by
the Prospectus. Other than as described in or contemplated by the Prospectus,
including documents incorporated therein by reference, there are no outstanding
warrants or options to purchase or rights to acquire any shares of capital stock
of the Company and there are no restrictions upon the voting or transfer of, or
the declaration or payment of any dividend or distribution on, any shares of
capital stock of the Company pursuant to the Company's Articles of Incorporation
or Bylaws, any agreement or other instrument to which the Transaction Entities
is a party or by which the Transaction Entities is bound, or any order, law,
rule, regulation or determination of any court, governmental agency or body
(including, without limitation, any banking or insurance regulatory agency or
body), or arbitrator having jurisdiction over any of the Transaction Entities.
(dd) The Transaction Entities and their Subsidiaries and affiliates have
not taken and will not take, directly or indirectly, any action designed to, or
that might be reasonably expected to, cause or result in stabilization or
manipulation of the price of the Shares, and the Transaction Entities and their
Subsidiaries and affiliates have not distributed and agree not to distribute any
prospectus or other offering material in connection with the offering and sale
of the Shares other than the Prospectus or other material permitted by the Act.
(ee) Each of the Transaction Entities maintains a system of internal
accounting controls sufficient to provide reasonable assurances that (i)
transactions are executed in accordance with management's general or specific
authorization; (ii) transactions are recorded as necessary to permit preparation
of financial statements in conformity with generally accepted accounting
principles and to maintain accountability for assets; (iii) access to assets is
permitted only in accordance with management's general or specific
authorization; and (iv) the recorded accountability for assets is compared with
existing assets at reasonable intervals and appropriate action is taken with
respect to any differences.
(ff) There is (i) no significant unfair labor practice complaint pending
against any of the Transaction Entities or their subsidiaries or, to the
knowledge of the Transaction Entities, threatened against any of them, before
the National Labor Relations Board or any state or local labor relations board,
and no significant grievance or more significant arbitration proceeding arising
out of or under any collective bargaining agreement is so pending against any of
the Transaction Entities or their subsidiaries or, to the knowledge of the
Transaction Entities, threatened against any of them, and (ii) no significant
strike, labor dispute, slowdown or stoppage pending against any of the
Transaction Entities or their subsidiaries or, to the knowledge of the
Transaction Entities, threatened against it or any of their subsidiaries except
for such actions specified in clause (i) or (ii) above which individually or in
the aggregate could not reasonably be expected to have a Material Adverse
Effect.
(gg) No statement, representation, warranty or covenant made by any of the
Transaction Entities in this Agreement or made in any certificate required by
this Agreement to be delivered to the Underwriter is, or will be, when made,
inaccurate, untrue or incorrect in any material respect; it being understood
that no representation is made under this Section 6(gg) with respect to the
Registration Statement or the Prospectus which are the subject of
representations contained in other paragraphs in this Section 6.
(hh) Any certificate or other document required to be delivered pursuant to
this Agreement and signed by any officer of any of the Transaction Entities and
delivered to the Underwriters or to counsel for the Underwriter in connection
with the sale of the Shares shall be deemed a representation made by the
applicable Transaction Entity to the Underwriter as to the matters covered
therein.
7. INDEMNIFICATION.
(a) Each of the Transaction Entities jointly and severally agrees to
indemnify and hold harmless the Underwriter and each person, if any, who
controls the Underwriter within the meaning of Section 15 of the Act or Section
20 of the Exchange Act, from and against any and all losses, claims, damages,
expenses, liabilities and judgments caused by or resulting from any untrue
statement or alleged untrue statement of a material fact contained in the
Registration Statement or the Prospectus (as amended or supplemented if the
Company shall have furnished any amendments or supplements thereto) or caused by
or resulting from any omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the statements therein
not misleading, except insofar as such losses, claims, damages, expenses,
liabilities or judgments are caused by or result from any such untrue statement
or omission or alleged untrue statement or omission based upon and in conformity
with information relating to the Underwriter furnished in writing to the Company
by or on behalf of the Underwriter expressly for use therein, provided, that
this indemnity agreement with respect to any prospectus shall not inure to the
benefit of the Underwriter from whom the person asserting any such losses,
liabilities, claims, damages or expenses purchased Shares, or any person
controlling the Underwriter, if a copy of the Prospectus (as then amended or
supplemented if the Company shall have furnished any such amendments or
supplements thereto) was not sent or given by or on behalf of the Underwriter to
such person, if such is required by law, at or prior to the written confirmation
of the sale of such Shares to such person and if the Prospectus (as so amended
or supplemented) would have corrected the defect giving rise to such loss,
liability, claim, damage or expense.
(b) In case any action shall be brought against the Underwriter or any
person controlling the Underwriter, based upon the Registration Statement or the
Prospectus or any amendment or supplement thereto and with respect to which
indemnity may be sought against any of the Transaction Entities, the Underwriter
shall promptly notify the Company in writing and the Company may, at its
election, assume the defense thereof, including the employment of counsel
reasonably satisfactory to such indemnified party and payment of all fees and
expenses. The Underwriter or any such controlling person shall have the right to
employ separate counsel in any such action and participate in but not control
the defense thereof, but the fees and expenses of such counsel shall, if any of
the Transaction Entities has assumed the defense as indicated above, be at the
expense of the Underwriter or such controlling person unless (i) the employment
of such counsel shall have been specifically authorized in writing by one of the
Transaction Entities, (ii) the Transaction Entities shall have failed to assume
the defense and employ counsel or (iii) the named parties to any such action
(including any impleaded parties) include both the Underwriter or such
controlling person and the Transaction Entities and the Underwriter or such
controlling person shall have been advised by such counsel that there may be one
or more legal defenses available to it which are different from or additional to
and in conflict with those available to the Transaction Entities (in which case
the Transaction Entities shall not have the right to assume the defense of such
action on behalf of the Underwriter or such controlling person, it being
understood, however, that the Transaction Entities shall not, in connection with
any one such action or separate but substantially similar or related actions in
the same jurisdiction arising out of the same general allegations or
circumstances, be liable for the fees and expenses of more than one separate
firm of attorneys for the Underwriter and controlling persons, which firm shall
be designated in writing by the Underwriter and that all such fees and expenses
shall be reimbursed as they are incurred provided, however, that if it is
determined by a final non appealable order of a court of competent jurisdiction
that any of the Transaction Entities has no indemnification obligation under
this Section 7, all fees and expenses paid by any of the Transaction Entities
pursuant to this sentence shall be returned to them upon demand. None of the
Transaction Entities shall be liable for any settlement of any such action
effected without its written consent, but if settled with their written consent,
each of the Transaction Entities agrees to indemnify and hold harmless the
Underwriter and any such controlling person from and against any loss or
liability by reason of such settlement to the extent required by this Section 7.
No indemnifying party shall, without the prior written consent of the
indemnified party, effect any settlement of any pending or threatened proceeding
in respect of which any indemnified party is or a party and indemnity could have
been sought hereunder by such indemnified party, unless such settlement includes
an unconditional release of such indemnified party from all liability on claims
that are the subject matter of such proceeding.
(c) The Underwriter agrees to indemnify and hold harmless each of the
Transaction Entities and each of their officers and directors who sign the
Registration Statement and any person controlling any of the Transaction
Entities within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act, to the same extent as the foregoing indemnity from each of the
Transaction Entities to the Underwriter, but only with reference to and in
conformity with information relating to the Underwriter furnished in writing by
or on behalf of the Underwriter expressly for use in the Registration Statement
or the Prospectus. In case any action shall be brought against any of the
Transaction Entities, any of their officers, directors, or any person
controlling any of the Transaction Entities, based on the Registration
Statement, the Prospectus and in respect of which indemnity may be sought
against the Underwriter, the Underwriter shall have the rights and duties given
to the Transaction Entities (except that if any of the Transaction Entities
shall have assumed the defense thereof, the Underwriter shall not be required to
do so, but may employ separate counsel therein and participate in but not
control the defense thereof but the fees and expenses of such counsel shall,
except as otherwise provided herein, be at the expense of the Underwriter), and
each of the Transaction Entities, their officers, directors, and any person
controlling any of the Transaction Entities shall have the rights and duties
given to the Underwriter, by Section 7(b) hereof.
(d) If the indemnification provided for in this Section 7 is unavailable to
an indemnified party in respect of any losses, claims, damages, expenses,
liabilities or judgments referred to therein, then each indemnifying party, in
lieu of indemnifying such indemnified party, shall contribute to the amount paid
or payable by such indemnified party as a result of such losses, claims,
damages, expenses, liabilities and judgments (i) in such proportion as is
appropriate to reflect the relative benefits received by the Transaction
Entities on the one hand and the Underwriter on the other hand from the offering
of the Shares 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 Underwriter, on the
other hand, in connection with the statements or omissions which resulted in
such losses, claims, damages, expenses, liabilities or judgments, as well as any
other relevant equitable considerations. The relative benefits received by the
Transaction Entities, on the one hand, and the Underwriter, on the other hand,
shall be deemed to be in the same proportion as the total net proceeds from the
Offering (before deducting expenses) received by the Transaction Entities and
the total underwriting discounts and commissions received by the Underwriter,
bear to the total price to the public of the Shares, in each case as set forth
in the Prospectus Supplement. The relative fault of the Transaction Entities, on
the one hand, and the Underwriter, on the other hand, shall be determined by
reference to, among other things, whether the untrue or alleged untrue statement
of a material fact or the omission to state a material fact relates to
information supplied by any of the Transaction Entities or the Underwriter and
the parties' relative intent, knowledge, access to information and opportunity
to correct or prevent such statement or omission.
Each of the Transaction Entities and the Underwriter agree
that it would not be just and equitable if contribution pursuant to this Section
7(d) were determined by pro rata allocation or by any other method of allocation
which does not take account of the equitable considerations referred to in the
immediately preceding paragraph. The amount paid or payable by an indemnified
party as a result of the losses, claims, damages, expenses, liabilities or
judgments referred to in the immediately preceding paragraph shall be deemed to
include, subject to the limitations set forth above, 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 7, the Underwriter shall not be required to contribute any amount in
excess of the amount by which the total price at which the Shares underwritten
by it and distributed to the public were offered to the public exceeds the
amount of any damages which the Underwriter has otherwise been required to pay
by reason of such untrue or alleged untrue statement or omission or alleged
omission. No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.
(e) The Underwriter confirms and each Transaction Entity acknowledges that
(i) the statements with respect to the public offering of the Shares by the
Underwriter set forth on the cover page of the Prospectus Supplement, (ii) the
legend concerning overallotments on page 2 of the Prospectus Supplement, (iii)
the first and last sentences of the second paragraph under the caption
"Underwriting" in the Prospectus Supplement are correct and constitute the only
information concerning the Underwriter furnished in writing to the Company by or
on behalf of the Underwriter specifically for inclusion in the Registration
Statement and Prospectus.
8. CONDITIONS OF UNDERWRITER'S OBLIGATIONS. The obligations of the Underwriter
to purchase the Shares under this Agreement are subject to the satisfaction of
each of the following conditions:
(a) All the representations and warranties of the Transaction Entities
contained in this Agreement shall be true and correct, in all material respects,
on the Closing Date, with the same force and effect as if made on and as of the
Closing Date.
(b) No stop order suspending the effectiveness of the Registration
Statement shall have been issued and no proceedings for that purpose shall have
been commenced or shall be pending before or threatened by the Commission to the
knowledge, after due inquiry, of the Company. No stop order suspending the
effectiveness of the Registration Statement shall have been issued and no
proceedings for that purpose shall have been commenced or shall be pending
before or threatened by the state securities authority of any jurisdiction, to
the knowledge of the Company.
(c) (i) Since the date of the latest balance sheet included or incorporated
by reference in the Registration Statement and the Prospectus, there shall not
have been any Material Adverse Effect, (ii) other than as set forth in the
Prospectus, no proceedings shall be pending or, to the knowledge of any of the
Transaction Entities, after due inquiry, threatened against any of the
Transaction Entities or any Properties before or by any federal, state or other
commission, board or administrative agency, where an unfavorable decision,
ruling or finding could reasonably be expected to result in a Material Adverse
Effect, and on the Closing Date you shall have received a certificate dated the
Closing Date, signed by the Chief Executive Officer or Executive Vice President
and the Chief Financial Officer of the Company, in their capacities as the Chief
Executive Officer or Executive Vice President and Chief Financial Officer of
each of the Transaction Entities and on behalf of each entity, confirming the
matters set forth in paragraphs (a), (b) and (c) of this Section 8.
(d) You shall have received on the Closing Date opinions, dated the Closing
Date of Ann M. McCormick, general counsel to the Company and Nixon, Hargrave,
Devans & Doyle LLP, counsel for the Company, in the forms attached hereto as
ANNEX A and ANNEX B.
(e) You shall have received on the Closing Date an opinion, dated the
Closing Date, of Hunton & Williams, counsel for the Underwriter, to the effect
that:
(i) the Shares have been duly authorized, and when issued and
delivered to the Underwriter against payment therefor as provided by
this Agreement, will have been validly issued and will be fully paid
and nonassessable, and the issuance of such Shares is not subject to
any preemptive or similar rights;
(ii) the Registration Statement has become effective under the
Act and, to the knowledge of such counsel, no stop order suspending
its effectiveness has been issued and no proceedings for that purpose
are pending before or threatened by the Commission;
(iii) this Agreement was duly and validly authorized, executed
and delivered by each of the Transaction Entities; and (iv) the
Registration Statement, at the time it became effective, and the
Prospectus, as of the date of the Prospectus Supplement (in each case,
other than documents incorporated therein by reference and the
financial statements and supporting schedules and other financial and
statistical data included or incorporated by reference therein, as to
which no opinion need be rendered) complied as to form in all material
respects with the requirements of the Act.
In addition, Hunton & Williams shall state that they have
participated in conferences with officers and other representatives of the
Transaction Entities and representatives of the independent public accountants
for the Company and representatives of the Underwriter at which the contents of
the Prospectus and related matters were discussed and, although they are not
passing upon and do not assume any responsibility for the accuracy, completeness
or fairness of the statements contained in the Registration Statement or the
Prospectus or the documents incorporated therein by reference, on the basis of
the foregoing (relying as to materiality to a large extent upon the opinions of
officers and other representatives of the Transaction Entities), no facts have
come to the attention of such counsel which lead them to believe that the
Registration Statement, including the documents incorporated therein by
reference, at the time the Company filed its Annual Report on Form 10-K for the
Year Ended December 31, 1997, or at the date of the Underwriting Agreement,
contained an untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make the statements therein
not misleading or that the Prospectus, including the documents incorporated
therein by reference, at the time the Prospectus was first provided to the
Underwriter for use in connection with the offering of the Shares or at the date
hereof, contained or contains an untrue statement of a material fact or omitted
or omits to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading (it being understood that such counsel need express no opinion with
respect to the financial statements and schedules and other financial or
statistical data included in the Registration Statement, the Prospectus or the
documents incorporated therein by reference).
(f) On the date hereof, Coopers & Lybrand L.L.P. shall have furnished to
the Underwriter the form of a letter, to be dated the date of its delivery,
addressed to the Underwriter and in form and substance satisfactory to the
Underwriter (and to its counsel), confirming that they are independent public
accountants with respect to the Transaction Entities and their subsidiaries as
required by the Act and with respect to the financial and other statistical and
numerical information contained in the Registration Statement. At the Closing
Date, Coopers & Lybrand L.L.P. shall have furnished to the Underwriter a letter,
dated the date of its delivery, which shall confirm, on the basis of a review in
accordance with the procedures set forth in the letter from it, that nothing has
come to its attention during the period from the date of the letter referred to
in the prior sentence to a date (specified in the letter) not more than five
days prior to the Closing Date, which would require any change in its letter
dated the date hereof if it were required to be dated and delivered at the
Closing Date.
(g) At the Closing Date, the Shares shall have been approved for listing on
the NYSE upon official notice of issuance.
(h) Each of the Transaction Entities and their subsidiaries shall not have
failed at or prior to the Closing Date, to perform or comply with any of the
agreements pursuant to Section 5 herein contained and required to be performed
or complied with by the Transaction Entities at or prior to the Closing Date.
(i) At the Closing Date, Hunton & Williams shall have been furnished with
such documents and opinions as they may reasonably require for the purpose of
enabling them to pass upon the issuance and sale of the Shares, 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 each of the
Transaction Entities in connection with the issuance and sale of the Shares as
herein contemplated shall be reasonably satisfactory in form and substance to
the Underwriter and Hunton & Williams.
9. EFFECTIVE DATE OF AGREEMENT AND TERMINATION. This Agreement shall become
effective upon the execution of this Agreement.
This Agreement may be terminated at any time prior to the
Closing Date by you by written notice to the Company if any of the following has
occurred: (i) since the respective dates as of which information is given in the
Registration Statement and the Prospectus, there has been a Material Adverse
Effect, (ii) any outbreak or escalation of hostilities or other national or
international calamity or crisis or change in economic conditions or in the
financial markets of the United States or elsewhere that, in your judgment, is
material and adverse and would, in your judgment, make it impracticable or
inadvisable (x) to commence or continue the offering of the shares to the public
or (y) to enforce contracts for the sale of the shares, (iii) the suspension or
material limitation of trading in securities on the NYSE or the American Stock
Exchange or material limitation on prices for securities on either of such
exchanges, (iv) the enactment, publication, decree or other promulgation of any
federal or state statute, regulation, rule or order of any court or other
governmental authority which in your reasonable opinion would result in a
Material Adverse Effect, (v) the declaration of a banking moratorium by either
federal or New York State authorities or (vi) the taking of any action by any
federal, state or local government or agency in respect of its monetary or
fiscal affairs which in your reasonable opinion has a material adverse effect on
the financial markets in the United States.
10. MISCELLANEOUS. Notices given pursuant to any provision of this Agreement
shall be addressed as follows: (a) if to the Company, to 850 Clinton Square,
Rochester, New York 14604 Attn: General Counsel and (b) if to you, to Wheat
First Securities, Inc., Attention: Syndicate Department, Riverfront Plaza, 901
East Byrd Street, Richmond, Virginia 23219, or in any case to such other address
as the person to be notified may have requested in writing.
The provisions of Sections 5, 6 and 7 shall remain operative
and in full force and effect, and will survive delivery of and payment for the
Shares, regardless of (i) any investigation, or statement as to the results
thereof, made by or on behalf of the Underwriter or by or on behalf of any of
the Transaction Entities, the officers or directors of any of the Transaction
Entities or any controlling person of any of the Transaction Entities and (ii)
acceptance of the Shares and payment for them hereunder, until the filing of the
Company's Annual Report on Form 10-K for the year ended December 31, 1998.
In the event of termination of this Agreement, the provisions
of Section 7 shall remain operative and in full force and effect, until the
filing of the Company's Annual Report on Form 10-K for the year ended December
31, 1998.
If this Agreement shall be terminated by the Underwriter
because of any material failure or refusal on the part of any of the Transaction
Entities to comply with the terms or to fulfill any of the conditions of this
Agreement, each of the Transaction Entities, jointly and severally, agrees to
reimburse the Underwriter for all out-of-pocket expenses (including the fees and
documented disbursements of counsel) reasonably incurred by the Underwriter.
Except as otherwise provided, this Agreement has been and is
made solely for the benefit of and shall be binding upon each of the Transaction
Entities and the Underwriter, any controlling persons referred to herein and
their respective successors and assigns, all as and to the extent provided in
this Agreement, and no other person shall acquire or have any right under or by
virtue of this Agreement. The term "successors and assigns" shall not include a
purchaser of any of the Shares from the Underwriter merely because of such
purchase.
This Agreement shall be governed and construed in accordance with the laws
of the State of New York.
This Agreement may be signed in various counterparts which
together shall constitute one and the same instrument.
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<PAGE>
Please confirm that the foregoing correctly sets forth the
agreement among the parties hereto.
Very truly yours,
HOME PROPERTIES OF NEW YORK, INC.
By: /s/ Nelson B. Leenhouts
-----------------------------
Name: Nelson B. Leenhouts Title: President
HOME PROPERTIES OF NEW YORK, L.P.
By: Home Properties of New York, Inc.
Its General Partner
By: /s/ Neslon B. Leenhouts
---------------------------------
Name: Nelson B. Leenhouts
Title: President
WHEAT FIRST SECURITIES, INC.
By: /s/ C.L. Kinder, III
--------------------
Name: Carr L. Kinder,III
Title: Vice President
